As
filed with the Securities and Exchange Commission on September 10, 2021
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
F-3
REGISTRATION
STATEMENT UNDER
THE
SECURITIES ACT OF 1933
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
(Exact
name of registrant as specified in its charter)
Not
Applicable
(Translation
of registrant’s name into English)
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Cayman
Islands
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Not
Applicable
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(State or other jurisdiction
of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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Floor
9, Building 14, HaixiBaiyue Town
No.
14 Duyuan Road, Luozhou Town
Cangshan
District, Fuzhou City 350001
People’s
Republic of China
+86-591-87590668
(Address
and telephone number of registrant’s principal executive offices)
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Copies of Correspondence to:
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Cogency
Global Inc.
122
East 42nd Street, 18th Floor
New
York, N.Y. 10168
(800)
221-0102
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Kevin
(Qixiang) Sun, Esq.
Bevilacqua
PLLC
1050
Connecticut Avenue, NW, Suite 500
Washington,
DC 20036
202-869-0888
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(Name,
address, and telephone number of agent for service)
Approximate
date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective.
If
only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the
following box. ☐
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box. ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If
this Form is a registration statement pursuant to General Instruction I.C. or a post-effective amendment thereto that shall become effective
upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☐
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.C. filed to register additional
securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company ☒
If
an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 7(a)(2)(B) of the Securities Act. ☐
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†
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The
term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board
to its Accounting Standards Codification after April 5, 2012.
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CALCULATION
OF REGISTRATION FEE
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Title of each class of securities to be registered
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Amount
to be
Registered (1)
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Proposed
Maximum
Aggregate
Price
Per Unit (2)
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Proposed
Maximum
Aggregate
Offering
Price (1)(2)
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Amount of
Registration
Fee (3)
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Ordinary Shares, par value $0.0001 per share
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Debt Securities
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Warrants
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Units
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Total
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$
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300,000,000
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$
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32,730
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(1)
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There are being registered hereunder such indeterminate number of Ordinary Shares; such indeterminate principal amount of debt securities;
such indeterminate number of warrants to purchase Ordinary Shares or debt securities; and such indeterminate number of units, as shall
have an aggregate initial offering price not to exceed $300,000,000. If any debt securities are issued at an original issue discount,
then the offering price of such debt securities shall be in such greater principal amount as shall result in an aggregate initial offering
price not to exceed $300,000,000. Any securities registered hereunder may be sold separately or as units with other securities registered
hereunder. The securities registered also include such indeterminate number of Ordinary Shares and debt securities as may be issued upon
conversion, exercise or exchange of convertible, exercisable or exchangeable securities being registered hereunder or pursuant to the
antidilution provisions of any such securities. In addition, pursuant to Rule 416 under the Securities Act of 1933, as amended, or the
Securities Act, the securities being registered hereunder include such indeterminate number of securities as may be issuable with respect
to the securities being registered hereunder as a result of stock splits, stock dividends or similar transactions.
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(2)
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The proposed maximum aggregate offering price for each class of securities will be determined from time to time by the registrant in connection
with the issuance by the registrant of the securities registered hereunder and is not specified as to each class of securities pursuant
to General Instruction II.C. of Form F-3 under the Securities Act.
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(3)
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Estimated solely for the
purposes of calculating the registration fee pursuant to Rule 457(o) of Regulation C under the Securities Act.
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The
registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act or until this registration statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.
The
information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not
soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
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Prospectus
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Subject
to completion, dated September 10, 2021
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E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
$300,000,000
Ordinary
Shares
Debt
Securities
Warrants
Units
We
may offer, issue and sell from time to time our Ordinary Shares, par value $0.0001 per share, debt securities, warrants, or units up
to $300,000,000 or its equivalent in any other currency, currency units, or composite currency or currencies in one or more issuances.
We may sell any combination of these securities in one or more offerings.
This
prospectus describes some of the general terms that may apply to these securities and the general manner in which they may be offered.
The specific terms of any securities to be offered, and the specific manner in which they may be offered, will be described in a supplement
to this prospectus or incorporated into this prospectus by reference. You should read this prospectus and any supplement carefully before
you invest. Each prospectus supplement will indicate if the securities offered thereby will be listed or quoted on a securities exchange
or quotation system.
The
information contained or incorporated in this prospectus or in any prospectus supplement is accurate only as of the date of this prospectus,
or such prospectus supplement, as applicable, regardless of the time of delivery of this prospectus or any sale of our securities.
Our
Ordinary Shares are listed on the Nasdaq Capital Market under the symbol “EJH.” On September 9, 2021, the closing sale
price of our Ordinary Shares, as reported on the Nasdaq Capital Market, was $3.82.
We
may offer securities through underwriting syndicates managed or co-managed by one or more underwriters, through agents, or directly to
purchasers. The prospectus supplement for each offering of securities will describe the plan of distribution for that offering. For general
information about the distribution of securities offered, please see “Plan of Distribution” in this prospectus.
Investors are cautioned that you are not
buying shares of a China-based operating company but instead are buying shares of a shell company issuer that maintains contractual
arrangements with the associated operating companies. Recent statements and regulatory actions by the Chinese government, such as
those related to the use of variable interest entities (“VIEs”) and data security or anti-monopoly concerns, may impact
the Company’s ability to conduct its business, accept foreign investments, or continue to be listed on Nasdaq.
We
are a holding company incorporated in the Cayman Islands with no material operations of our own. We conduct our business in China through
the consolidated VIEs, Pingtan Comprehensive Experimental Area E Home Service Co., Ltd. and Fuzhou Bangchang Technology Co. Ltd., and
their subsidiaries. Our wholly-owned PRC subsidiary, E-Home Household Service Technology Co., Ltd. (“E-Home WFOE”), as a
foreign-invested enterprise under PRC laws, is not eligible to operate a value-added telecommunication business in China. E-Home WFOE
has nominal operations or assets and controls and receives 100% of the economic benefits of the VIEs through contractual arrangements.
See “Risk Factors—Risks Related to Our Corporate Structure” beginning on page 3 of this prospectus for certain risks
related to our corporate structure and see also “Item 4. Information on the Company—A. History and Development of the Company—Corporate
Structure” of our most recent Annual Report on Form 20-F filed on November 16, 2020 for a summary of the contractual arrangements.
Investing
in our securities involves risks. You should carefully consider the risk factors beginning on page 3 of this prospectus, in any accompanying
prospectus supplement and in any related free writing prospectus, and in the documents incorporated by reference into this prospectus,
any accompanying prospectus supplement and any related free writing prospectus before making any decision to invest in our securities.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed
upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The
date of this prospectus is , 2021
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the SEC, using a “shelf”
registration process. Under this shelf registration process, we may sell our securities described in this prospectus in one or more offerings
up to a total dollar amount of $300,000,000 (or its equivalent in foreign or composite currencies).
This
prospectus provides you with a general description of the securities that may be offered. Each time we offer our securities, we will
provide you with a supplement to this prospectus that will describe the specific amounts, prices and terms of the securities we offer.
The prospectus supplement may also add, update or change information contained in this prospectus. This prospectus, together with applicable
prospectus supplements and the documents incorporated by reference in this prospectus and any prospectus supplements, includes all material
information relating to this offering. Please read carefully both this prospectus and any prospectus supplement together with additional
information described below under “Where You Can Find More Information.”
You
should rely only on the information contained in or incorporated by reference in this prospectus and any applicable prospectus supplement.
We have not authorized anyone to provide you with different or additional information. If anyone provides you with different or inconsistent
information, you should not rely on it. We take no responsibility for, and can provide no assurance as to the reliability of, any other
information that others may give you. The information contained in this prospectus is accurate only as of the date of this prospectus,
regardless of the time of delivery of this prospectus or any sale of securities described in this prospectus. This prospectus is not
an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale
is not permitted.
You
should not assume that the information contained in this prospectus and the accompanying prospectus supplement is accurate on any date
subsequent to the date set forth on the front of the document or that any information that we have incorporated by reference is correct
on any date subsequent to the date of the document incorporated by reference. Our business, financial condition, results of operations
and prospects may have changed since those dates.
Unless
the context otherwise requires, the terms “we,” “our,” “us,” “our company,” and the “Company”
in this prospectus each refer to E-Home Household Service Holdings Limited and its consolidated subsidiaries and variable interest entities
(“VIEs”).
THE
COMPANY
Investors are cautioned that you are not
buying shares of a China-based operating company but instead are buying shares of a shell company issuer that maintains contractual
arrangements with the associated operating companies. Recent statements and regulatory actions by the Chinese government, such as
those related to the use of VIEs and data security or anti-monopoly concerns, may impact the Company’s ability to conduct its
business, accept foreign investments, or continue to be listed on Nasdaq.
The
information contained in or incorporated by reference into this prospectus summarizes certain information about our company. It may not
contain all of the information that is important to you. To understand this offering fully, you should read carefully the entire prospectus
and the other information incorporated by reference into this prospectus.
We
are a household service company based in Fuzhou, China. We provide integrated household services through our website and WeChat platform,
“e家快服”, across 32 provinces in China. Currently, these services primarily include home appliance services
and housekeeping services. For our home appliance services, we partner with individuals and service stores which provide the technicians
to deliver the on-site services. We have partnerships with more than 2,600 individuals and service stores providing these services in
China. For our housekeeping services, we primarily partner with individual service providers who serve as independent contractors. We
currently have more than 2,700 cleaners and nannies providing our housekeeping services. Our online platform integrates these offline
service providers, which helps them to gain a larger customer base, and provides professional and reliable one-stop household services
to our customers.
We
were incorporated as an exempted company with limited liability under the laws of the Cayman Islands on September 24, 2018 to serve as
a holding company for our PRC operations. On October 16, 2018, we established a wholly-owned subsidiary in Hong Kong, E-Home Household
Service Holdings Limited (which name is identical to the Company’s), which holds all of the equity interests of E-Home Household
Service Technology Co., Ltd. (“E-Home WFOE”). E-Home WFOE was established in the PRC on December 5, 2018 and has entered
into contractual arrangements with the VIEs, Pingtan Comprehensive Experimental Area E Home Service Co., Ltd. (“E-Home Pingtan”)
and Fuzhou Bangchang Technology Co. Ltd. (“Fuzhou Bangchang”), two limited liability companies established under the laws
of the PRC on April 1, 2014 and March 15, 2007, respectively.
We
conduct our business in China through the consolidated VIEs, E-Home Pingtan and Fuzhou Bangchang, and their subsidiaries. Our wholly-owned
PRC subsidiary, E-Home WFOE, as a foreign-invested enterprise under PRC laws, is not eligible to operate a value-added telecommunication
business in China. E-Home WFOE has nominal operations or assets and controls and receives 100% of the economic benefits of the VIEs through
contractual arrangements. See “Risk Factors—Risks Related to Our Corporate Structure” beginning on page 3 of this prospectus
for certain risks related to our corporate structure and see also “Item 4. Information on the Company—A. History and Development
of the Company—Corporate Structure” of our most recent Annual Report on Form 20-F filed on November 16, 2020 for a summary
of the contractual arrangements.
Corporate
Information
Our
principal executive offices are located at Floor 9, Building 14, HaixiBaiyue Town, No. 14 Duyuan Road, Luozhou Town, Cangshan District,
Fuzhou City 350001, People’s Republic of China. The telephone number at our executive offices is +86-591-87590668.
Our registered office is at Harneys Fiduciary (Cayman)
Limited, 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands. Our agent for service
of process in the United States is Cogency Global Inc., located at 122 East 42nd Street, 18th Floor, New York, NY 10168.
Our website can be found at www.ej111.com. Information
on our website is not incorporated by reference into this prospectus, any prospectus supplement or into any information incorporated herein
by reference. You should not consider information on our website to be part of this prospectus, prospectus supplement, any free writing
prospectus or any information incorporated by reference herein.
RISK
FACTORS
An
investment in our securities involves a high degree of risk. We operate in a highly competitive environment in which there are numerous
factors which can influence our business, financial position or results of operations and which can also cause the market value of our
Ordinary Shares to decline. Many of these factors are beyond our control and therefore, are difficult to predict. Prior to making a decision
about investing in our securities, you should carefully consider the risk factors discussed in the sections entitled “Risk Factors”
contained in our most recent Annual Report on Form 20-F filed with the SEC, and in any applicable prospectus supplement and our other
filings with the SEC and incorporated by reference in this prospectus or any applicable prospectus supplement, together with all of the
other information contained in this prospectus or any applicable prospectus supplement. If any of the risks or uncertainties described
in our SEC filings or any prospectus supplement or any additional risks and uncertainties actually occur, our business, financial condition
and results of operations could be materially and adversely affected. In that case, the trading price of our securities could decline
and you might lose all or part of your investment.
The
following disclosure is intended to update and supplement previously disclosed risk factors facing the Company set forth in the Company’s
public filings. The updated risk factors should be carefully considered along with any other risk factors identified in the Company's
other reports filed with the SEC.
Risks
Related to Our Corporate Structure
We are a holding company with no material operations
of our own and our PRC subsidiary has nominal operations or assets. We conduct our business in China through the consolidated VIEs and
their subsidiaries. If the PRC government deems that the contractual arrangements in relation to the consolidated VIEs do not comply with
PRC regulatory restrictions on foreign investment in the relevant industries, or if these regulations or the interpretation of existing
regulations change in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations.
As we continually enrich the service offerings on
our platform, we plan to engage in telecommunications-related businesses, including value-added online services for platform participants,
in the future. The PRC government regulates telecommunications-related businesses through strict business licensing requirements and other
government regulations. These laws and regulations also include limitations on foreign ownership of PRC companies that engage in telecommunications-related
businesses. Specifically, foreign investors are not allowed to own more than 50% equity interest in any PRC company engaging in a value-added
telecommunications business and the proportional ratio of the capital contributions respectively made by the Chinese investors and foreign
investors of a foreign-invested telecom enterprise at different phases shall be determined pursuant to the relevant provisions of the
State Council’s department in charge of industry and information technology. The primary foreign investor must have experience and
a good track record in providing value-added telecommunications services overseas.
Because
we are an exempted company incorporated with limited liability in the Cayman Islands, we are classified as a foreign enterprise under
PRC laws and regulations, and our wholly-owned PRC subsidiary, E-Home WFOE, is a foreign-invested enterprise. Accordingly, our subsidiary
is not eligible to operate a value-added telecommunications service business in China. The consolidated VIE, E-Home Pingtan applied for
and has obtained a license to engage in value-added telecommunications businesses with a five-year term expiring on November 21, 2024.
As we plan to operate a value-added telecommunications service business in the future, we conduct our business in China through the consolidated
VIEs and their affiliates. E-Home WFOE has entered into a series of contractual arrangements with the consolidated VIEs and their shareholders.
For a description of these contractual arrangements, see “Corporate History and Structure—Our Corporate Structure.”
We
believe that our corporate structure and contractual arrangements comply with the current applicable PRC laws and regulations. Our PRC
legal counsel, based on its understanding of the relevant laws and regulations, is of the opinion that (i) our current ownership structure,
the ownership structure of our PRC subsidiary, the consolidated VIEs and their subsidiaries are not in violation of existing PRC laws,
rules and regulations and (ii) the contractual arrangements among them constitute valid, legal and binding obligations enforceable against
each party of such agreements in accordance with the terms of each agreement, and will not result in any violation of PRC laws or regulations
currently in effect.
As
there are substantial uncertainties regarding the interpretation and application of PRC laws and regulations, including the Regulations
on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, and the Telecommunications Regulations
and the relevant regulatory measures concerning the telecommunications industry, there can be no assurance that the PRC government authorities,
such as the Ministry of Commerce or other authorities that regulate online services providers and other participants in the telecommunications
industry, would ultimately take a view that is consistent with the opinion of our PRC legal counsel or agree that our corporate structure
or any of the above contractual arrangements comply with PRC licensing, registration or other regulatory requirements, with existing
policies or with requirements or policies that may be adopted in the future. PRC laws and regulations governing the validity of these
contractual arrangements are uncertain and the relevant government authorities have broad discretion in interpreting these laws and regulations.
If
our corporate structure and contractual arrangements are deemed by the Ministry of Commerce or other regulators having competent authority
to be illegal, either in whole or in part, we may lose control of the consolidated VIEs and may have to modify such structure to comply
with regulatory requirements. However, there can be no assurance that we can achieve this without material disruption to our business.
Further, if our corporate structure and contractual arrangements are found to be in violation of any existing or future PRC laws or regulations,
the relevant regulatory authorities would have broad discretion in dealing with such violations, including:
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revoking our business and
operating licenses of such entities;
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confiscating any of our
income that they deem to be obtained through illegal operations;
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shutting down our services;
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discontinuing or restricting
our operations in China;
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imposing conditions or
requirements with which we may not be able to comply;
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requiring us to change
our corporate structure, including terminating the contractual arrangements with the VIEs and deregistering the equity pledges
of the VIEs, which in turn would affect our ability to consolidate, derive economic interests from, or exert effective control over
the VIEs;
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restricting or prohibiting
our use of the proceeds from overseas offerings to finance the PRC consolidated VIEs’ business and operations; and
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taking other regulatory
or enforcement actions that could be harmful to our business.
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Furthermore,
new PRC laws, rules and regulations may be introduced to impose additional requirements that may be applicable to our corporate structure
and contractual arrangements. See “Risks Related to Our Corporate Structure—Substantial uncertainties exist with respect
to the interpretation and implementation of the Foreign Investment Law of PRC.” Occurrence of any of these events could materially
and adversely affect our business and financial condition and results of operations. In addition, if the imposition of any of these penalties
or requirements to restructure our corporate structure causes us to lose the right to direct the activities of the consolidated VIEs
or our right to receive their economic benefits, we would no longer be able to consolidate the financial results of such VIEs in our
consolidated financial statements. If our corporate structure and contractual arrangements are deemed to be illegal by relevant regulators,
our business and results of operations would be materially and adversely affected and the price of our shares may decline. See “Corporate
History and Structure—Our Corporate Structure.”
The
contractual arrangements with the consolidated VIEs may result in adverse tax consequences to us.
Under
applicable PRC laws and regulations, arrangements and transactions among related parties may be subject to audit or challenge by the
PRC tax authorities. The PRC enterprise income tax law requires every enterprise in China to submit its annual enterprise income tax
return together with a report on transactions with its related parties to the relevant tax authorities. The tax authorities may impose
reasonable adjustments on taxation if they have identified any related party transactions that are inconsistent with arm’s length
principles. We could face material and adverse tax consequences if the PRC tax authorities determine that our contractual arrangements
with the consolidated VIEs were not made on an arm’s length basis and adjust our income and expenses for PRC tax purposes by requiring
a transfer pricing adjustment. A transfer pricing adjustment could adversely affect us by (i) increasing the tax liabilities of
the consolidated VIEs without reducing the tax liability of our subsidiaries, which could further result in late payment fees and other
penalties to the consolidated VIEs for underpaid taxes; or (ii) limiting the ability of the consolidated VIEs to obtain or maintain
preferential tax treatments and other financial incentives.
We
rely on contractual arrangements with the consolidated VIEs and their shareholders to operate our business, which may not be as effective
as direct ownership in providing operational control and may have potential conflicts of interests with us, which may have a material
adverse effect on our business and financial condition.
If
we had direct ownership of the VIEs, we would be able to exercise our rights as shareholders to effect changes in the directors and senior
management of the VIEs, which in turn could implement changes, subject to any applicable fiduciary obligations, at the management and
operational level. However, under the current contractual arrangements, see “Corporate History and Structure—Our Corporate
Structure”, we rely on the performance by the VIEs and its respective shareholders of their obligations under the contracts to
exercise control over the VIEs. However, the shareholders of the consolidated VIEs may not act in the best interests of our company or
may not perform their obligations under these contracts. Such risks exist throughout the period in which we intend to operate certain
portions of our business through the contractual arrangements with VIEs. All of our revenue is attributed to the consolidated VIEs. These
contractual arrangements may not be as effective as direct ownership in providing foreign investors with control over the consolidated
VIEs. If the consolidated VIEs or their shareholders fail to perform their respective obligations under these contractual arrangements,
our recourse to the assets held by the consolidated VIEs is indirect and we may have to incur substantial costs and expend significant
resources to enforce such arrangements in reliance on legal remedies under PRC law. These remedies may not always be effective, particularly
in light of uncertainties in the PRC legal system. Furthermore, in connection with litigation, arbitration or other judicial or dispute
resolution proceedings, assets under the name of any of the record holders of equity interest in the consolidated VIEs, including such
equity interest, may be put under court custody. As a consequence, we cannot be certain that the equity interest will be disposed pursuant
to the contractual arrangement or ownership by the record holder of the equity interest.
All
of these contractual arrangements are governed by PRC law and provide for the resolution of disputes through arbitration in the PRC.
Accordingly, these contracts would be interpreted in accordance with PRC laws and any disputes would be resolved in accordance with PRC
legal procedures. The legal environment in the PRC is not as developed as in other jurisdictions, such as the United States. As
a result, uncertainties in the PRC legal system could limit our ability to enforce these contractual arrangements. In the event that
we are unable to enforce these contractual arrangements, or if we suffer significant time delays or other obstacles in the process of
enforcing these contractual arrangements, it would be very difficult to exert effective control over the consolidated VIEs, and our ability
to conduct our business and our financial condition and results of operations may be materially and adversely affected. See “Risks
Related to Doing Business in China—There are various uncertainties regarding the interpretation and enforcement of PRC laws, rules
and regulations.”
In
connection with our operations in China, we rely on the shareholders of the consolidated VIEs to fulfill by the obligations under such
contractual arrangements. The interests of these shareholders in their individual capacities as shareholders of the consolidated VIEs
may differ from the interests of our company as a whole, as what is in the best interests of the consolidated VIEs, including matters
such as whether to distribute dividends or to make other distributions to fund our offshore requirement, may not be in the best interests
of our company. There can be no assurance that when conflicts of interest arise, any or all of these individuals or entities will act
in the best interests of our company or that those conflicts of interest will be resolved in our favor. In addition, these individuals
and entities may breach or cause the consolidated VIEs and their subsidiaries to breach or refuse to renew the existing contractual arrangements
with us.
Currently,
we do not have arrangements that address potential conflicts of interest shareholders of the consolidated VIEs may encounter due to their
dual roles as shareholders of consolidated VIEs and as beneficial owners of our company. However, we could, at all times, exercise our
option under the exclusive option agreement to cause them to transfer all of their equity ownership in the consolidated VIEs to a PRC
entity or individual designated by us as permitted by the then applicable PRC laws. In addition, if such conflicts of interest arise,
we could also, in the capacity of attorney-in-fact of the then existing shareholders of the consolidated VIEs as provided under the powers
of attorney, directly appoint new directors of the consolidated VIEs. We rely on the shareholders of the consolidated VIEs to comply
with PRC laws and regulations, which protect contracts, and to provide that directors and executive officers owe a duty of loyalty to
our company and require them to avoid conflicts of interest and not to take advantage of their positions for personal gains, and with
the laws of the Cayman Islands, which provide that directors have a duty of care and a duty of loyalty to act honestly in good faith
with a view to our best interests. However, the legal frameworks of China and the Cayman Islands do not provide guidance on resolving
conflicts in the event of a conflict with another corporate governance regime. If we cannot resolve any conflicts of interest or disputes
between us and the shareholders of the consolidated VIEs, we would have to rely on legal proceedings, which could result in disruption
of our business and subject us to substantial uncertainty as to the outcome of any such legal proceedings.
Substantial
uncertainties exist with respect to the interpretation and implementation of the Foreign Investment Law of PRC.
On
March 15, 2019, the Standing Committee of the National People’s Congress passed the Foreign Investment Law of PRC, which took effect
on January 1, 2020. The Law of the People’s Republic of China on China-Foreign Equity Joint Ventures, the Law of the People’s
Republic of China on Wholly Foreign-Owned Enterprises, and the Law of the People’s Republic of China on China-Foreign Contractual
Joint Ventures shall be replaced at the same time. The Foreign Investment Law of PRC makes no mention of VIE structures. Accordingly,
the Foreign Investment Law of PRC sets aside issues that still remain controversial but are relatively less urgent, such as the legality
of the VIE structure and leaves those less urgent issues to legislative authorization. This means that VIE structures may in the
future still be regarded as “foreign investment” under separate laws, administrative regulations formulated by the State
Council, and regulatory documents according to the catch-all provision “foreign investments in other forms as provided by law,
administrative regulations, or by the State Council” found in paragraph 2, Article 2 of the Foreign Investment Law of PRC.
Any
failure by the VIEs or their shareholders to perform their obligations under our contractual arrangements with them would have a material
and adverse effect on our business.
If
the VIEs or their shareholders fail to perform their respective obligations under the contractual arrangements, we may have to incur
substantial costs and expend additional resources to enforce such arrangements. We may also have to rely on legal remedies under PRC
law, including seeking specific performance or injunctive relief, and claiming damages, which we cannot assure you will be effective.
For example, if the shareholders of the VIEs were to refuse to transfer their equity interest to us or our designee when we exercise
the purchase option pursuant to these contractual arrangements, or if they were otherwise to act in bad faith toward us, we may have
to take legal actions to compel them to perform their contractual obligations.
The
VIEs conduct our businesses. In the event we are unable to enforce our contractual arrangements, we may not be able to exert effective
control over the VIEs, and our ability to conduct these businesses may be negatively affected.
The
shareholders of the VIEs may have potential conflicts of interest with us, which may materially and adversely affect our business and
financial condition.
The
equity interests of each of the VIEs are held by numerous shareholders, including Wenshan Xie, our Chairman and Chief Executive Officer.
These shareholders may have potential conflicts of interest with us. These shareholders may breach, or cause the VIEs to breach, the
existing contractual arrangements, which would have a material adverse effect on our ability to effectively control the VIEs and their
subsidiaries and receive economic benefits from them. For example, these shareholders may be able to cause our agreements with the VIEs
to be performed in a manner adverse to us by, among other things, failing to remit payments due under the contractual arrangements to
us on a timely basis. We cannot assure you that when conflicts of interest arise, any or all of these shareholders will act in the best
interests of our company or such conflicts will be resolved in our favor.
Currently,
we do not have any arrangements to address potential conflicts of interest between these shareholders and our company, except that we
could exercise our purchase option under the exclusive option agreements with these shareholders to request them to transfer all of their
equity interests in the VIEs to a PRC entity or individual designated by us, to the extent permitted by PRC laws. If we cannot resolve
any conflict of interest or dispute between us and these shareholders, we would have to rely on legal proceedings, which could result
in the disruption of our business and subject us to substantial uncertainty as to the outcome of any such legal proceedings.
Risks
Related to Doing Business in China
There
are various uncertainties regarding the interpretation and enforcement of PRC laws, rules and regulations.
Substantially
all of our operations are conducted in the PRC, and are governed by PRC laws, rules and regulations. Our PRC subsidiary and the consolidated
VIEs are subject to laws, rules and regulations applicable to foreign investment in China. The PRC legal system is a civil law system
based on written statutes. Unlike the common law system, prior court decisions may be cited for reference but have limited precedential
value.
In 1979, the PRC government began to promulgate a
comprehensive system of laws, rules and regulations governing economic matters in general. The overall effect of legislation over the
past four decades has significantly enhanced the protections afforded to various forms of foreign investment in China. However, China
has not developed a fully integrated legal system, and recently enacted laws, rules and regulations may not sufficiently cover all aspects
of economic activities in China or may be subject to significant degrees of interpretation by PRC regulatory agencies. In particular,
because these laws, rules and regulations, especially those relating to the internet, are relatively new, and because of the limited number
of published decisions and the nonbinding nature of such decisions, and because the laws, rules and regulations often give the relevant
regulator significant discretion in how to enforce them, the interpretation and enforcement of these laws, rules and regulations involve
uncertainties and can be inconsistent and unpredictable. In addition, the PRC legal system is based in part on government policies and
internal rules, some of which are not published on a timely basis or at all, and may have a retroactive effect. As a result, we may not
be aware of our violation of these policies and rules until after the occurrence of the violation.
Any
administrative and court proceedings in China may be protracted, resulting in substantial costs and diversion of resources and management
attention. Since PRC administrative authorities and courts have significant discretion in interpreting and implementing statutory and
contractual terms, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection
we enjoy than in more developed legal systems. These uncertainties may impede our ability to enforce the contracts we have entered into
and could materially and adversely affect our business, financial condition and results of operations.
In
addition, the PRC government has recently announced its plans to enhance its regulatory oversight of Chinese companies listing overseas.
The Opinions on Strictly Cracking Down on Illegal Securities Activities issued on July 6, 2021 called for:
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tightening oversight of
data security, cross-border data flow and administration of classified information, as well as amendments to relevant regulation
to specify responsibilities of overseas listed Chinese companies with respect to data security and information security;
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enhanced oversight of overseas
listed companies as well as overseas equity fundraising and listing by Chinese companies; and
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extraterritorial application
of China’s securities laws.
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As
the Opinions on Strictly Cracking Down on Illegal Securities Activities were recently issued, there are great uncertainties with respect
to the interpretation and implementation thereof. The Chinese government may promulgate relevant laws, rules and regulations that may
impose additional and significant obligations and liabilities on overseas listed Chinese companies regarding data security, cross-border
data flow, and compliance with China’s securities laws. See also “Our business is subject to complex and evolving laws and
regulations regarding privacy and data protection. These laws and regulations can be complex and stringent, and many are subject to change
and uncertain interpretation, which could result in claims, change to our data and other business practices, regulatory investigations,
penalties, increased cost of operations, or declines in user growth or engagement, or otherwise affect our business.” It is uncertain
whether or how these new laws, rules and regulations and the interpretation and implementation thereof may affect us, but among other
things, our ability and the ability of our subsidiaries to obtain external financing through the issuance of equity securities overseas
could be negatively affected.
Our
business is subject to complex and evolving laws and regulations regarding privacy and data protection. These laws and regulations can
be complex and stringent, and many are subject to change and uncertain interpretation, which could result in claims, changes to our data
and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in user growth or engagement,
or otherwise affect our business.
Regulatory
authorities in China have implemented and are considering further legislative and regulatory proposals concerning data protection. New
laws and regulations that govern new areas of data protection or impose more stringent requirements may be introduced in China. In addition,
the interpretation and application of consumer and data protection laws in China are often uncertain, in flux and complicated, including
differentiated requirements for different groups of people or different types of data.
The
PRC regulatory and enforcement regime with regard to privacy and data security is evolving. The PRC Cybersecurity Law provides that personal
information and important data collected and generated by operators of critical information infrastructure in the course of their operations
in the PRC should be stored in the PRC, and the law imposes heightened regulation and additional security obligations on operators of
critical information infrastructure. According to the Cybersecurity Review Measures promulgated by the Cyberspace Administration of China
and certain other PRC regulatory authorities in April 2020, which became effective in June 2020, operators of critical information infrastructure
must pass a cybersecurity review when purchasing network products and services which do or may affect national security. If we provide
or are deemed to provide such network products and services to critical information infrastructure operators, or we are deemed to be
a critical information infrastructure operator, we would be required to follow cybersecurity review procedures. There can be no assurance
that we would be able to complete the applicable cybersecurity review procedures in a timely manner, or at all, if we are required to
follow such procedures. Any failure or delay in the completion of the cybersecurity review procedures may prevent us from using or providing
certain network products and services, and may result in fines of up to ten times the purchase price of such network products and services
being imposed upon us, if we are to be deemed a critical information infrastructure operator using network products or services without
having completed the required cybersecurity review procedures. The PRC government is increasingly focused on data security, recently
launching cybersecurity review against a number of mobile apps operated by several US-listed Chinese companies and prohibiting these
apps from registering new users during the review period.
In
addition, on July 10, 2021, the Cyberspace Administration of China issued the Measures for Cybersecurity Review (Revision Draft for Comments)
for public comments, which proposes to authorize the relevant government authorities to conduct cybersecurity review on a range of activities
that affect or may affect national security, including listings in foreign countries by companies that possess the personal data of more
than one million users. The PRC National Security Law covers various types of national security, including technology security and information
security.
Regulators
in China may also implement measures to ensure that encryption of users’ data does not hinder law enforcement agencies’ access
to that data. For example, according to the PRC Cybersecurity Law and relevant regulations, network operators are obligated to provide
assistance and support in accordance with the law for public security and national security authorities to protect national security
or assist with criminal investigations. Compliance with these laws and requirements in manners that are perceived as harming privacy
could lead to significant damages to our reputation and proceedings and actions against us by regulators and private parties.
On March 12, 2021, the Cyberspace Administration of China, the MIIT, the
Ministry of Public Security and the SAMR jointly promulgated the Provisions on the Scope of Necessary Personal Information Required for
Common Types of Mobile Internet Applications, which became effective on May 1, 2021, clarifying the scope of necessary information
required for certain common mobile apps and stating that mobile apps operators may not deny users’ access to basic functions and
services when the users opt out of the collection of unnecessary personal information. The Cyberspace Administration of China has since
named a number of mobile apps in its regulatory announcement for failure to comply with privacy and data security regulations, and ordered
these apps to rectify their data collection and use practices. On June 10, 2021, the Standing Committee of the National People’s
Congress of China promulgated the Data Security Law which took effect on September 1, 2021, and on August 20, 2021, the Standing Committee
of the National People’s Congress of China promulgated the Personal Information Protection Law which will be effective on November
1, 2021. The Data Security Law provides for data security and privacy obligations of entities and individuals carrying out data activities,
prohibits entities and individuals in China from providing any foreign judicial or law enforcement authority with any data stored in China
without approval from competent PRC authority, and sets forth the legal liabilities of entities and individuals found to be in violation
of their data protection obligations, including rectification order, warning, fines of up to RMB5 million, suspension of relevant business,
and revocation of business permits or licenses. As the Data Security Law was recently promulgated and the Draft Personal Information Protection
Law remains subject to change, we may be required to make further adjustments to our business practices to comply with the effective or
enacted form of the laws. The Personal Information Protection Law provides that where a personal data processor provides others with the
personal data it processes, the personal data processor shall inform the relevant individuals of the identity and contact information
of the recipient, processing purposes and methods and the types of personal data and obtain separate consent from each individual. According
to the Regulations for the Supervision and Administration of Online Transactions which was effective on May 1,2021, network transaction
operators shall not provide consumers' personal information to any third party, including related parties, without the authorization and
consent of the person whose information is collected.
Compliance
with the PRC Cybersecurity Law, the PRC National Security Law, the Data Security Law, the Cybersecurity Review Measures, as well as additional
laws and regulations that PRC regulatory bodies may enact in the future, including data security and personal information protection
laws, may result in additional expenses to us and subject us to negative publicity, which could harm our reputation among users and negatively
affect the trading price of our ordinary shares in the future. There are also uncertainties with respect to how the PRC Cybersecurity
Law, the PRC National Security Law and the Data Security Law will be implemented and interpreted in practice. PRC regulators, including
the Department of Public Security, the MIIT, the SAMR and the Cyberspace Administration of China, have been increasingly focused on regulation
in the areas of data security and data protection, including for mobile apps, and are enhancing the protection of privacy and data security
by rule-making and enforcement actions at central and local levels. We expect that these areas will receive greater and continued attention
and scrutiny from regulators and the public going forward, which could increase our compliance costs and subject us to heightened risks
and challenges associated with data security and protection. If we are unable to manage these risks, we could become subject to penalties,
including fines, suspension of business, prohibition against new user registration (even for a short period of time) and revocation of
required licenses, and our reputation and results of operations could be materially and adversely affected.
Any
failure, or perceived failure, by us to comply with the above and other regulatory requirements or privacy protection-related laws, rules
and regulations could result in reputational damages or proceedings or actions against us by governmental entities, consumers or others.
These proceedings or actions could subject us to significant penalties and negative publicity, require us to change our data and other
business practices, increase our costs and severely disrupt our business, or negatively affect the trading price of our ordinary shares.
FORWARD-LOOKING
STATEMENTS
This
prospectus contains or incorporates forward-looking statements within the meaning of section 27A of the Securities Act and section 21E
of the Exchange Act of 1934, as amended, or the Exchange Act. These forward-looking statements are management’s beliefs and assumptions.
In addition, other written or oral statements that constitute forward-looking statements are based on current expectations, estimates
and projections about the industry and markets in which we operate and statements may be made by or on our behalf. Words such as “should,”
“could,” “may,” “expect,” “anticipate,” “intend,” “plan,” “believe,”
“seek,” “estimate,” variations of such words and similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are
difficult to predict. There are a number of important factors that could cause our actual results to differ materially from those indicated
by such forward-looking statements.
We
describe material risks, uncertainties and assumptions that could affect our business, including our financial condition and results
of operations, under “Risk Factors” and may update our descriptions of such risks, uncertainties and assumptions in any prospectus
supplement. We base our forward-looking statements on our management’s beliefs and assumptions based on information available to
our management at the time the statements are made. We caution you that actual outcomes and results may differ materially from what is
expressed, implied or forecast by our forward-looking statements. Accordingly, you should be careful about relying on any forward-looking
statements. Reference is made in particular to forward-looking statements regarding growth strategies, financial results, product and
service development, competitive strengths, intellectual property rights, litigation, mergers and acquisitions, market acceptance or
continued acceptance of our services, accounting estimates, financing activities, ongoing contractual obligations and sales efforts.
Except as required under the federal securities laws, the rules and regulations of the SEC, stock exchange rules, and other applicable
laws, regulations and rules, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution
of this prospectus, whether as a result of new information, future events, changes in assumptions, or otherwise.
USE
OF PROCEEDS
Except
as described in any prospectus supplement and any free writing prospectus in connection with a specific offering, we currently intend
to use the net proceeds from the sale of the securities offered by us under this prospectus to fund the growth of our business, primarily
working capital, and for general corporate purposes.
We
may also use a portion of the net proceeds to acquire or invest in technologies, products and/or businesses that we believe will enhance
the value of our Company. Depending on future events and others changes in the business climate, we may determine at a later time to
use the net proceeds for different purposes. As a result, our management will have broad discretion in the allocation of the net proceeds
and investors will be relying on the judgment of our management regarding the application of the proceeds of any sale of the securities.
Additional information on the use of net proceeds from the sale of securities covered by this prospectus may be set forth in the prospectus
supplement relating to the specific offering.
CAPITALIZATION
AND INDEBTEDNESS
Our
capitalization and indebtedness will be set forth in a prospectus supplement to this prospectus or in a report of foreign private issuer
on Form 6-K subsequently furnished to the SEC and specifically incorporated herein by reference.
DESCRIPTION
OF SHARE CAPITAL
Our
authorized share capital is $50,000, divided into 500,000,000 ordinary shares, with a par value of $0.0001 each. As of September 7, 2021,
there were 33,581,556 Ordinary Shares issued and outstanding.
For
a description of our Ordinary Shares, including the rights and obligations attached thereto, please refer to Exhibit 2.1 to our Annual
Report on Form 20-F for the fiscal year ended June 30, 2020, which is incorporated by reference herein.
DESCRIPTION
OF DEBT SECURITIES
The
following is a summary of the general terms of the debt securities that we may issue and is not intended to be complete. If debt securities
are issued, we will describe in the applicable prospectus supplement the particular terms and provisions of any series of the debt securities
and a description of how the general terms and provisions described below may apply to that series of the debt securities. The terms
presented here, together with the terms in a related prospectus supplement, will be a description of the material terms of the debt securities.
You should also read the indenture under which the debt securities are to be issued. We have filed a form of indenture governing different
types of debt securities with the SEC as an exhibit to the registration statement of which this prospectus is a part. All capitalized
terms have the meanings specified in the indenture.
We
may issue, from time to time, debt securities, in one or more series, that will consist of senior debt, senior subordinated debt or subordinated
debt. We refer to the subordinated debt securities and the senior subordinated debt securities together as the subordinated securities.
The debt securities that we may offer will be issued under an indenture between us and an entity, identified in the applicable prospectus
supplement, as trustee. Debt securities, whether senior, senior subordinated or subordinated, may be issued as convertible debt securities
or exchangeable debt securities. The following is a summary of the material provisions of the indenture filed as an exhibit to the registration
statement of which this prospectus is a part.
As
you read this section, please remember that for each series of debt securities, the specific terms of your debt security as described
in the applicable prospectus supplement will supplement and, if applicable, may modify or replace the general terms described in the
summary below. The statement we make in this section may not apply to your debt security. Prospective investors should rely on information
in the applicable prospectus supplement and not on the following information to the extent that the information in such prospectus supplement
is different from the following information.
General
Terms of the Indenture
The
indenture does not limit the amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal
amount that we may authorize and may be in any currency or currency unit that we may designate. We may, without the consent of the holders
of any series, increase the principal amount of securities in that series in the future, on the same terms and conditions and with
the same CUSIP numbers as that series. Except for the limitations on consolidation, merger and sale of all or substantially all of our
assets contained in the indenture, the terms of the indenture do not contain any covenants or other provisions designed to give
holders of any debt securities protection against changes in our operations, financial condition or transactions involving us.
We
may issue the debt securities issued under the indenture as “discount securities,” which means they may be sold at a discount
below their stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be
issued with “original issue discount”, or OID, for U.S. federal income tax purposes because of interest payment and other
characteristics. Material U.S. federal income tax considerations applicable to debt securities issued with original issue discount will
be described in more detail in any applicable prospectus supplement.
The
applicable prospectus supplement for a series of debt securities that we issue will describe, among other things, the following terms
of the offered debt securities:
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the title and authorized
denominations of the series of debt securities;
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any limit on the aggregate
principal amount of the series of debt securities;
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whether such debt securities
will be issued in fully registered form without coupons or in a form registered as to principal only with coupons or in bearer form
with coupons;
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whether issued in the form
of one or more global securities and whether all or a portion of the principal amount of the debt securities is represented thereby;
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the price or prices at
which the debt securities will be issued;
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the date or dates on which
principal is payable;
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the place or places where
and the manner in which principal, premium or interest, if any, will be payable and the place or places where the debt securities
may be presented for transfer and, if applicable, conversion or exchange;
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interest rates, and the
dates from which interest, if any, will accrue, and the dates when interest is payable and the maturity;
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the right, if any, to extend
the interest payment periods and the duration of the extensions;
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our rights or obligations
to redeem or purchase the debt securities;
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any sinking fund or other
provisions that would obligate us to repurchase or otherwise redeem some or all of the debt securities;
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conversion or exchange
provisions, if any, including conversion or exchange prices or rates and adjustments thereto;
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the currency or currencies
of payment of principal or interest;
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the terms applicable to
any debt securities issued at a discount from their stated principal amount;
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the terms, if any, under
which any debt securities will rank junior to any of our other debt;
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whether and upon what terms
the debt securities may be defeased, if different from the provisions set forth in the indenture;
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if the amount of payments
of principal or interest is to be determined by reference to an index or formula, or based on a coin or currency other than that
in which the debt securities are stated to be payable, the manner in which these amounts are determined and the calculation agent,
if any, with respect thereto;
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the provisions, if any,
relating to any collateral provided for the debt securities;
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if other than the entire
principal amount of the debt securities when issued, the portion of the principal amount payable upon acceleration of maturity as
a result of a default on our obligations;
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the events of default and
covenants relating to the debt securities that are in addition to, modify or delete those described in this prospectus;
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the nature and terms of
any security for any secured debt securities; and
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any other specific terms
of any debt securities.
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The
applicable prospectus supplement will present material U.S. federal income tax considerations for holders of any debt securities and
the securities exchange or quotation system on which any debt securities are to be listed or quoted.
Senior
Debt Securities
Payment
of the principal of, premium and interest, if any, on senior debt securities will rank on a parity with all of our other secured/unsecured
and unsubordinated debt.
Senior
Subordinated Debt Securities
Payment
of the principal of, premium and interest, if any, on senior subordinated debt securities will be junior in right of payment to the prior
payment in full of all of our unsubordinated debt, including senior debt securities and any credit facility. We will state in the applicable
prospectus supplement relating to any senior subordinated debt securities the subordination terms of the securities as well as the aggregate
amount of outstanding debt, as of the most recent practicable date, that by its terms would be senior to the senior subordinated debt
securities. We will also state in such prospectus supplement limitations, if any, on issuance of additional senior debt.
Subordinated
Debt Securities
Payment
of the principal of, premium and interest, if any, on subordinated debt securities will be subordinated and junior in right of payment
to the prior payment in full of all of our senior debt, including our senior debt securities and senior subordinated debt securities.
We will state in the applicable prospectus supplement relating to any subordinated debt securities the subordination terms of the securities
as well as the aggregate amount of outstanding indebtedness, as of the most recent practicable date, that by its terms would be senior
to the subordinated debt securities. We will also state in such prospectus supplement limitations, if any, on issuance of additional
senior indebtedness.
Conversion
or Exchange Rights
Debt
securities may be convertible into or exchangeable for other securities being registered in this registration statement, including, for
example, shares of our equity securities. The terms and conditions of conversion or exchange will be stated in the applicable prospectus
supplement. The terms will include, among others, the following:
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the conversion or exchange
price;
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the conversion or exchange
period;
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provisions regarding the
ability of us or the holder to convert or exchange the debt securities;
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events requiring adjustment
to the conversion or exchange price; and
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provisions affecting conversion
or exchange in the event of our redemption of the debt securities.
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Consolidation,
Merger or Sale
We
cannot consolidate or merge with or into, or transfer or lease all or substantially all of our assets to, any person, and we cannot permit
any other person to consolidate with or merge into us, unless (1) we will be the continuing corporation or (2) the successor corporation
or person to which our assets are transferred or leased is a corporation organized under the laws of the United States, any state of
the United States or the District of Columbia and it expressly assumes our obligations under the debt securities and the indenture. In
addition, we cannot complete such a transaction unless immediately after completing the transaction, no event of default under the indenture,
and no event which, after notice or lapse of time or both, would become an event of default under the indenture, shall have occurred
and be continuing. When the person to whom our assets are transferred or leased has assumed our obligations under the debt securities
and the indenture, we shall be discharged from all our obligations under the debt securities and the indenture except in limited circumstances.
This
covenant would not apply to any recapitalization transaction, a change of control of us or a highly leveraged transaction, unless the
transaction or change of control were structured to include a merger or consolidation or transfer or lease of all or substantially all
of our assets.
Events
of Default
The
term “Event of Default,” when used in the indenture, unless otherwise indicated, means any of the following:
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failure to pay interest
for 30 days after the date payment is due and payable;
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failure to pay principal
or premium, if any, on any debt security when due, either at maturity, upon any redemption, by declaration or otherwise;
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failure to make sinking
fund payments when due;
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failure to perform other
covenants for 60 days after notice that performance was required;
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events in bankruptcy, insolvency
or reorganization relating to us; or
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any other Event of Default
provided in the applicable officer’s certificate, resolution of our board of directors or the supplemental indenture under
which we issue a series of debt securities.
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An
Event of Default for a particular series of debt securities does not necessarily constitute an Event of Default for any other series
of debt securities issued under the indenture.
If
an Event of Default with respect to any series of senior debt securities occurs and is continuing, then either the trustee for such series
or the holders of a majority in aggregate principal amount of the outstanding debt securities of such series, by notice in writing, may
declare the principal amount of and interest on all of the debt securities of such series to be due and payable immediately; provided,
however, unless otherwise provided in the applicable prospectus supplement, if such an Event of Default occurs and is continuing with
respect to more than one series of senior debt securities under the indenture, the trustee for such series or the holders of a majority
in aggregate principal amount of the outstanding debt securities of all such series of senior debt securities of equal ranking (or, if
any of such senior debt securities are discount securities, such portion of the principal amount as may be specified in the terms of
that series), voting as one class, may make such declaration of acceleration as to all series of such equal ranking and not the holders
of the debt securities of any one of such series of senior debt securities.
If
an Event of Default with respect to any series of subordinated securities occurs and is continuing, then either the trustee for such
series or the holders of a majority in aggregate principal amount of the outstanding debt securities of such series, by notice in writing,
may declare the principal amount of and interest on all of the debt securities of such series to be due and payable immediately; provided,
however, unless otherwise provided in the applicable prospectus supplement, if such an Event of Default occurs and is continuing with
respect to more than one series of subordinated securities under the indenture, the trustee for such series or the holders of a majority
in aggregate principal amount of the outstanding debt securities of all such series of subordinated securities of equal ranking (or,
if any of such subordinated securities are discount securities, such portion of the principal amount as may be specified in the terms
of that series), voting as one class, may make such declaration of acceleration as to all series of equal ranking and not the holders
of the debt securities of any one of such series of subordinated securities. The holders of not less than a majority in aggregate principal
amount of the debt securities of all affected series of equal ranking may, after satisfying certain conditions, rescind and annul any
of the above-described declarations and consequences involving such series.
If
an Event of Default relating to events in bankruptcy, insolvency or reorganization of us occurs and is continuing, then the principal
amount of all of the debt securities outstanding, and any accrued interest, will automatically become due and payable immediately, without
any declaration or other act by the trustee or any holder.
The
indenture imposes limitations on suits brought by holders of debt securities against us. Except for actions for payment of overdue principal
or interest, no holder of debt securities of any series may institute any action against us under the indenture unless:
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the holder has previously
given to the trustee written notice of default and continuance of such default;
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the holders of not less
than a majority in principal amount of the outstanding debt securities of the affected series of equal ranking have requested that
the trustee institute the action;
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the requesting holders
have offered the trustee reasonable indemnity for expenses and liabilities that may be incurred by bringing the action;
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the trustee has not instituted
the action within 60 days of the request; and
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the trustee has not received
inconsistent direction by the holders of a majority in principal amount of the outstanding debt securities of the affected series
of equal ranking.
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We
will be required to file annually with the trustee a certificate, signed by one of our officers, stating whether or not the officer knows
of any default by us in the performance, observance or fulfillment of any condition or covenant of the indenture.
Registered
Global Securities and Book Entry System
The
debt securities of a series may be issued in whole or in part in book-entry form and may be represented by one or more fully registered
global securities or in unregistered form with or without coupons. We will deposit any registered global securities with a depositary
or with a nominee for a depositary identified in the applicable prospectus supplement and registered in the name of such depositary or
nominee. In such case, we will issue one or more registered global securities denominated in an amount equal to the aggregate principal
amount of all of the debt securities of the series to be issued and represented by such registered global security or securities. This
means that we will not issue certificates to each holder.
Unless
and until it is exchanged in whole or in part for debt securities in definitive registered form, a registered global security may not
be transferred except as a whole:
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by the depositary for such
registered global security to its nominee;
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by a nominee of the depositary
to the depositary or another nominee of the depositary; or
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by the depositary or its
nominee to a successor of the depositary or a nominee of the successor.
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The
prospectus supplement relating to a series of debt securities will describe the specific terms of the depositary arrangement involving
any portion of the series represented by a registered global security. We anticipate that the following provisions will apply to all
depositary arrangements for registered debt securities:
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ownership of beneficial
interests in a registered global security will be limited to persons that have accounts with the depositary for such registered global
security, these persons being referred to as “participants,” or persons that may hold interests through participants;
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upon the issuance of a
registered global security, the depositary for the registered global security will credit, on its book-entry registration and transfer
system, the participants’ accounts with the respective principal amounts of the debt securities represented by the registered
global security beneficially owned by the participants;
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any dealers, underwriters,
or agents participating in the distribution of the debt securities represented by a registered global security will designate the
accounts to be credited; and
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ownership of beneficial
interest in such registered global security will be shown on, and the transfer of such ownership interest will be effected only through,
records maintained by the depositary for such registered global security for interests of participants, and on the records of participants
for interests of persons holding through participants.
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The
laws of some states may require that specified purchasers of securities take physical delivery of the securities in definitive form.
These laws may limit the ability of those persons to own, transfer or pledge beneficial interests in registered global securities.
So
long as the depositary for a registered global security, or its nominee, is the registered owner of such registered global security,
the depositary or such nominee, as the case may be, will be considered the sole owner or holder of the debt securities represented by
the registered global security for all purposes under the indenture. Except as stated below, owners of beneficial interests in a registered
global security:
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will not be entitled to
have the debt securities represented by a registered global security registered in their names;
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will not receive or be
entitled to receive physical delivery of the debt securities in the definitive form; and
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will not be considered
the owners or holders of the debt securities under the relevant indenture.
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Accordingly,
each person owning a beneficial interest in a registered global security must rely on the procedures of the depositary for the registered
global security and, if the person is not a participant, on the procedures of a participant through which the person owns its interest,
to exercise any rights of a holder under the indenture.
We
understand that under existing industry practices, if we request any action of holders or if an owner of a beneficial interest in a registered
global security desires to give or take any action that a holder is entitled to give or take under the indenture, the depositary for
the registered global security would authorize the participants holding the relevant beneficial interests to give or take the action,
and the participants would authorize beneficial owners owning through the participants to give or take the action or would otherwise
act upon the instructions of beneficial owners holding through them.
We
will make payments of principal and premium, if any, and interest, if any, on debt securities represented by a registered global security
registered in the name of a depositary or its nominee to the depositary or its nominee, as the case may be, as the registered owners
of the registered global security. None of us, the trustee or any other agent of ours or the trustee will be responsible or liable for
any aspect of the records relating to, or payments made on account of, beneficial ownership interests in the registered global security
or for maintaining, supervising or reviewing any records relating to the beneficial ownership interests.
We
expect that the depositary for any debt securities represented by a registered global security, upon receipt of any payments of principal
and premium, if any, and interest, if any, in respect of the registered global security, will immediately credit participants’
accounts with payments in amounts proportionate to their respective beneficial interests in the registered global security as shown on
the records of the depositary. We also expect that standing customer instructions and customary practices will govern payments by participants
to owners of beneficial interests in the registered global security held through the participants, as is now the case with the securities
held for the accounts of customers in bearer form or registered in “street name.” We also expect that any of these payments
will be the responsibility of the participants.
If the depositary for any debt securities represented
by a registered global security is at any time unwilling or unable to continue as depositary or stops being a clearing agency registered
under the Exchange Act, we will appoint an eligible successor depositary. If we fail to appoint an eligible successor depositary within
90 days, we will issue the debt securities in definitive form in exchange for the registered global security. In addition, we may at any
time and in our sole discretion decide not to have any of the debt securities of a series represented by one or more registered global
securities. In that event, we will issue debt securities of the series in a definitive form in exchange for all of the registered global
securities representing the debt securities. The trustee will register any debt securities issued in definitive form in exchange for a
registered global security in the name or names as the depositary, based upon instructions from its participants, who shall instruct the
trustee.
We
may also issue bearer debt securities of a series in the form of one or more global securities, referred to as “bearer global securities.”
The prospectus supplement relating to a series of debt securities represented by a bearer global security will describe the applicable
terms and procedures. These will include the specific terms of the depositary arrangement and any specific procedures for the issuance
of debt securities in definitive form in exchange for a bearer global security, in proportion to the series represented by a bearer global
security.
Discharge,
Defeasance and Covenant Defeasance
We
can discharge or decrease our obligations under the indenture as stated below.
We
may discharge obligations to holders of any series of debt securities that have not already been delivered to the trustee for cancellation
and that have either become due and payable or are by their terms to become due and payable, or are scheduled for redemption, within
sixty (60) days. We may effect a discharge by irrevocably depositing with the trustee cash or U.S. government obligations, as trust
funds, in an amount certified to be enough to pay when due, whether at maturity, upon redemption or otherwise, the principal of, premium
and interest, if any, on the debt securities and any mandatory sinking fund payments.
Unless
otherwise provided in the applicable prospectus supplement, we may also discharge any and all of our obligations to holders of any series
of debt securities at any time, which we refer to as defeasance. We may also be released from the obligations imposed by any covenants
of any outstanding series of debt securities and provisions of the indenture, and we may omit to comply with those covenants without
creating an event of default under the trust declaration, which we refer to as covenant defeasance. We may effect defeasance and covenant
defeasance only if, among other things:
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we irrevocably deposit
with the trustee cash or U.S. government obligations, as trust funds, in an amount certified to be enough to pay at maturity, or
upon redemption, the principal, premium and interest, if any, on all outstanding debt securities of the series;
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we deliver to the trustee
an opinion of counsel from a nationally recognized law firm to the effect that the holders of the series of debt securities will
not recognize income, gain or loss for U.S. federal income tax purposes as a result of the defeasance or covenant defeasance and
that defeasance or covenant defeasance will not otherwise alter the holders’ U.S. federal income tax treatment of principal,
premium and interest, if any, payments on the series of debt securities; and
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in the case of subordinated
debt securities, no event or condition shall exist that, based on the subordination provisions applicable to the series, would prevent
us from making payments of principal of, premium and interest, if any, on any of the applicable subordinated debt securities at the
date of the irrevocable deposit referred to above or at any time during the period ending on the 91st day after the deposit date.
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In
the case of a defeasance by us, the opinion we deliver must be based on a ruling of the Internal Revenue Service issued, or a change
in U.S. federal income tax law occurring, after the date of the indenture, since such a result would not occur under the U.S. federal
income tax laws in effect on such date.
Although
we may discharge or decrease our obligations under the indenture as described in the two preceding paragraphs, we may not avoid, among
other things, our duty to register the transfer or exchange of any series of debt securities, to replace any temporary, mutilated, destroyed,
lost or stolen series of debt securities or to maintain an office or agency in respect of any series of debt securities.
Modification
of the Indenture
The
indenture provides that we and the trustee may enter into supplemental indentures without the consent of the holders of debt securities
to:
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secure any debt securities
and provide the terms and conditions for the release or substitution of the security;
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evidence the assumption
by a successor corporation of our obligations;
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add covenants for the protection
of the holders of debt securities;
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add any additional events
of default;
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cure any ambiguity or correct
any inconsistency or defect in the indenture;
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add to, change or eliminate
any of the provisions of the indenture in a manner that will become effective only when there is no outstanding debt security which
is entitled to the benefit of the provision as to which the modification would apply;
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establish the forms or
terms of debt securities of any series;
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eliminate any conflict
between the terms of the indenture and the Trust Indenture Act of 1939;
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evidence and provide for
the acceptance of appointment by a successor trustee and add to or change any of the provisions of the indenture as is necessary
for the administration of the trusts by more than one trustee; and
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make any other provisions
with respect to matters or questions arising under the indenture that will not be inconsistent with any provision of the indenture
as long as the new provisions do not adversely affect the interests of the holders of any outstanding debt securities of any series
created prior to the modification.
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The
indenture also provides that we and the trustee may, with the consent of the holders of not less than a majority in aggregate principal
amount of debt securities of all series of senior debt securities or of Subordinated Securities of equal ranking, as the case may be,
then outstanding and affected, voting as one class, add any provisions to, or change in any manner, eliminate or modify in any way the
provisions of, the indenture or modify in any manner the rights of the holders of the debt securities. We and the trustee may not, however,
without the consent of the holder of each outstanding debt security affected thereby:
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extend the final maturity
of any debt security;
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reduce the principal amount
or premium, if any;
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reduce the rate or extend
the time of payment of interest;
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reduce any amount payable
on redemption or impair or affect any right of redemption at the option of the holder of the debt security;
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change the currency in
which the principal, premium or interest, if any, is payable;
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reduce the amount of the
principal of any debt security issued with an original issue discount that is payable upon acceleration or provable in bankruptcy;
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alter provisions of the
relevant indenture relating to the debt securities not denominated in U.S. dollars;
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impair the right to institute
suit for the enforcement of any payment on any debt security when due;
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if applicable, adversely
affect the right of a holder to convert or exchange a debt security; or
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reduce the percentage of
holders of debt securities of any series whose consent is required for any modification of the indenture.
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The
indenture provides that the holders of not less than a majority in aggregate principal amount of the then outstanding debt securities
of any and all affected series of equal ranking, by notice to the relevant trustee, may on behalf of the holders of the debt securities
of any and all such series of equal ranking waive any default and its consequences under the indenture except:
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a continuing default in
the payment of interest on, premium, if any, or principal of, any such debt security held by a non-consenting holder; or
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a default in respect of
a covenant or provision of the indenture that cannot be modified or amended without the consent of the holder of each outstanding
debt security of each series affected.
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Concerning
the Trustee
The
indenture provides that there may be more than one trustee under the indenture, each for one or more series of debt securities. If there
are different trustees for different series of debt securities, each trustee will be a trustee of a trust under the indenture separate
and apart from the trust administered by any other trustee under that indenture.
Except
as otherwise indicated in this prospectus or any prospectus supplement, any action permitted to be taken by a trustee may be taken by
such trustee only on the one or more series of debt securities for which it is the trustee under the indenture. Any trustee under the
indenture may resign or be removed from one or more series of debt securities. All payments of principal of, premium and interest, if
any, on, and all registration, transfer, exchange, authentication and delivery of, the debt securities of a series will be effected by
the trustee for that series at an office designated by the trustee.
If
the trustee becomes a creditor of ours, the indenture places limitations on the right of the trustee to obtain payment of claims or to
realize on property received in respect of any such claim as security or otherwise. The trustee may engage in other transactions. If
it acquires any conflicting interest relating to any duties concerning the debt securities, however, it must eliminate the conflict or
resign as trustee.
The
holders of a majority in aggregate principal amount of any and all affected series of debt securities of equal ranking then outstanding
will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the trustee
concerning the applicable series of debt securities, provided that the direction:
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would not conflict with
any rule of law or with the relevant indenture;
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would not be unduly prejudicial
to the rights of another holder of the debt securities; and
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would not involve any trustee
in personal liability.
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The
indenture provides that in case an Event of Default shall occur, not be cured and be known to any trustee, the trustee must use the same
degree of care as a prudent person would use in the conduct of his or her own affairs in the exercise of the trustee’s power. The
trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request of any of the holders
of the debt securities, unless they shall have offered to the trustee security and indemnity satisfactory to the trustee.
No
Individual Liability of Incorporators, Stockholders, Officers or Directors
No
recourse under or upon any obligation, covenant or agreement of this Indenture, or of any debt security thereunder, or for any claim
based thereon or otherwise in respect thereof, shall be had against any incorporator, stockholder, officer or director, as such, past,
present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture
and the obligations issued hereunder are solely corporate obligations of the Company, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, the incorporators, stockholders, officers or directors, as such, of the Company or of any successor
corporation, or any of them.
Governing
Law
The
indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York.
DESCRIPTION
OF WARRANTS
We
may issue warrants for the purchase of our Ordinary Shares and/or debt securities in one or more series. We may issue warrants independently
or together with our Ordinary Shares and/or debt securities, and the warrants may be attached to or traded separate and apart from these
securities. Each series of warrants will be issued under a warrant agreement all as set forth in the prospectus supplement. The applicable
prospectus supplement or term sheet will describe the terms of the warrants offered thereby, any warrant agreement relating to such warrants
and the warrant certificates, including but not limited to the following:
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the title of the warrants;
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the offering price or prices
of the warrants, if any;
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the minimum or maximum
amount of the warrants which may be exercised at any one time;
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the currency or currency
units in which the offering price, if any, and the exercise price are payable;
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the number of securities,
if any, with which such warrants are being offered and the number of such warrants being offered with each security;
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the date, if any, on and
after which such warrants and the related securities, if any, will be transferable separately;
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the amount of securities
purchasable upon exercise of each warrant and the price at which the securities may be purchased upon such exercise, and events or
conditions under which the amount of securities may be subject to adjustment;
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the date on which the right
to exercise such warrants shall commence and the date on which such right shall expire;
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the circumstances, if any,
which will cause the warrants to be deemed to be automatically exercised;
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any material risk factors,
if any, relating to such warrants;
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the identity of any warrant
agent; and
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any other material terms
of the warrants.
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Prior
to the exercise of any warrants, holders of such warrants will not have any rights of holders of the securities purchasable upon such
exercise, including the right to receive payments of dividends or the right to vote such underlying securities. Prospective purchasers
of warrants should be aware that material U.S. federal income tax, accounting and other considerations may be applicable to instruments
such as warrants.
DESCRIPTION
OF UNITS
We
may issue units comprised of one or more of the other securities described in this prospectus in any combination. Each unit will be issued
so that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights
and obligations of a holder of each included security. The unit agreement under which a unit is issued may provide that the securities
included in the unit may not be held or transferred separately, at any time or at any time before a specified date.
The
applicable prospectus supplement may describe:
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the designation and terms
of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held
or transferred separately;
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any provisions for the
issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; and
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any additional terms of
the governing unit agreement.
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The
applicable prospectus supplement will describe the terms of any units. The preceding description and any description of units in the
applicable prospectus supplement does not purport to be complete and is subject to and is qualified in its entirety by reference to the
unit agreement and, if applicable, collateral arrangements and depositary arrangements relating to such units.
TAXATION
Our
most recent Annual Report on Form 20-F provides a discussion of certain tax considerations that may be relevant to prospective
investors in our securities. The applicable prospectus supplement may also contain information about certain material tax considerations
relating to the securities covered by such prospectus supplement. You should consult your own tax advisors prior to acquiring any of
our securities.
PLAN
OF DISTRIBUTION
We
may sell the securities offered by this prospectus in any one or more of the following ways (or in any combination) from time to time:
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directly to investors,
including through privately negotiated transactions, a specific bidding, auction or other process;
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to investors through agents;
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to or through underwriters
or dealers;
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in “at the market”
offerings, within the meaning of the Rule 415(a)(4) of the Securities Act, to or through a market maker or into an existing trading
market on an exchange or otherwise;
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through a combination of
any such methods of sale; or
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through any other method
permitted by applicable law and described in the applicable prospectus supplement.
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The
accompanying prospectus supplement will set forth the terms of the offering and the method of distribution and will identify any firms
acting as underwriters, dealers or agents in connection with the offering, including:
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the names and addresses
of any underwriters, dealers or agents;
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the purchase price of the
securities and the proceeds to us from the sale, if any;
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any over-allotment options
under which underwriters may purchase additional securities from us;
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any underwriting discounts
and other items constituting compensation to underwriters, dealers or agents;
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any public offering price,
any discounts or concessions allowed or reallowed or paid to dealers; and
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any securities exchange
or market on which the securities offered in the prospectus supplement may be listed.
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If
underwriters are used in the sale, the underwriters will acquire the offered securities for their own account and may resell them from
time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The offered securities may be offered either to the public through underwriting syndicates represented by one or
more managing underwriters or by one or more underwriters without a syndicate. Unless otherwise set forth in a prospectus supplement,
the obligations of the underwriters to purchase any series of securities will be subject to certain conditions precedent and the underwriters
will be obligated to purchase all of such series of securities if any are purchased. Only those underwriters identified in such prospectus
supplement are deemed to be underwriters in connection with the securities offered in the prospectus supplement. Any underwritten offering
may be on a best efforts or a firm commitment basis.
Pursuant to an agreement dated August 13, 2021, Joseph
Stone Capital, LLC shall serve as the exclusive agent, advisor
or underwriter in any offering of securities of the Company during the term ending August 13, 2022.
In
connection with the sale of our securities, underwriters or agents may receive compensation (in the form of discounts, concessions or
commissions) from us, or from purchasers of securities for whom they may act as agents. Underwriters may sell securities to or through
dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or
commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the distribution
of our securities may be deemed to be “underwriters” as that term is defined in the Securities Act, and any discounts allowed
or commissions paid, and any profit on the resale of the securities they realize may be deemed to be underwriting discounts and commissions
under the Securities Act. Any person who may be deemed to be an underwriter will be identified, and the compensation received from us
will be described, in the prospectus supplement. Maximum compensation to any underwriters, dealers or agents will not exceed any applicable
Financial Industry Regulatory Authority limitations.
Underwriters
and agents may be entitled to indemnification by us against some civil liabilities, including liabilities under the Securities Act, or
to contributions with respect to payments which the underwriters or agents may be required to make relating to these liabilities. Underwriters
and agents may be customers of, engage in transactions with, or perform services for us in the ordinary course of business.
Unless
otherwise specified in the related prospectus supplement, each series of securities will be a new issue with no established trading market,
other than our Ordinary Shares, which are listed on the Nasdaq Capital Market. Any Ordinary Shares sold pursuant to a prospectus supplement
will be listed on the Nasdaq Capital Market, subject to official notice of issuance. We may elect to list any series of debt securities
on an exchange, but we are not obligated to do so. It is possible that one or more underwriters may make a market in the securities,
but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of, or the trading market for, any offered securities.
The
aggregate proceeds to us from the sale of our Ordinary Shares will be the purchase price of our Ordinary Shares less discounts or commissions,
if any. We reserve the right to accept and, together with our agents from time to time, to reject, in whole or in part, any proposed
purchase of our Ordinary Shares to be made directly or through agents.
To
facilitate the offering of the Ordinary Shares offered by us, certain persons participating in the offering may engage in transactions
that stabilize, maintain or otherwise affect the price of our Ordinary Shares. This may include over-allotments or short sales, which
involve the sale by persons participating in the offering of more shares than were sold to them. In these circumstances, these persons
would cover such over-allotments or short positions by making purchases in the open market or by exercising their over-allotment option,
if any. In addition, these persons may stabilize or maintain the price of our Ordinary Shares by bidding for or purchasing shares in
the open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating in the offering may be reclaimed
if shares sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize
or maintain the market price of our Ordinary Shares at a level above that which might otherwise prevail in the open market. These transactions
may be discontinued at any time.
EXPENSES
OF ISSUANCE AND DISTRIBUTION
The
following table sets forth the various expenses in connection with the sale and distribution of the securities being registered. We will
bear all of the expenses shown below.
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Securities and Exchange Commission registration fee
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$
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32,730
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Printing expenses
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*
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Legal fees and expenses
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*
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Accounting fees and expenses
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*
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Transfer agent fees and expenses
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*
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Miscellaneous
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*
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Total
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$
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*
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*
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The
amount of securities and number of offerings are indeterminable, and the expenses cannot be estimated at this time.
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LEGAL
MATTERS
Except
as otherwise set forth in the applicable prospectus supplement, the validity of any securities offered pursuant to this prospectus
will be passed upon by Conyers Dill & Pearman. Certain other legal matters relating to U.S. federal law and the laws of the
State of New York will be passed upon for us by Bevilacqua PLLC.
If
legal matters in connection with offerings made pursuant to this prospectus are passed upon by counsel to underwriters, dealers or agents,
such counsel will be named in the applicable prospectus supplement relating to any such offering.
EXPERTS
The
consolidated financial statements of the Company as of June 30, 2020 and for the year ended June 30, 2020 incorporated in this prospectus
by reference to the Annual Report on Form 20-F for the year ended June 30, 2020, have been so incorporated in reliance on the
report of TPS Thayer, LLC, an independent registered public accounting firm, given on the authority of said firm as experts in accounting
and auditing.
The
consolidated financial statements of the Company as of June 30, 2019 and for each of the two-year period ended June 30, 2019 incorporated
in this prospectus by reference to the Annual Report on Form 20-F for the year ended June 30, 2020, have been so incorporated
in reliance on the report of Thayer O’Neal Company, LLC, an independent registered public accounting firm, given on the authority
of said firm as experts in accounting and auditing.
INDEMNIFICATION
Insofar
as indemnification by us for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling
the company pursuant to provisions of our amended and restated memorandum and articles of association, or otherwise, we have been
advised that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore
unenforceable. In the event that a claim for indemnification by such director, officer or controlling person of us in the successful
defense of any action, suit or proceeding is asserted by such director, officer or controlling person in connection with the securities
being offered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act
and will be governed by the final adjudication of such issue.
ENFORCEMENT
OF CIVIL LIABILITIES
We
are incorporated under the laws of the Cayman Islands as an exempted company with limited liability. We are incorporated in the Cayman
Islands because of certain benefits associated with being a Cayman Islands company, such as political and economic stability, an effective
judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional
and support services. However, the Cayman Islands has a less developed body of securities laws as compared to the United States
and provides less protection for investors. In addition, Cayman Islands companies may not have standing to sue before the federal courts
of the United States.
Our
constitutional documents do not contain provisions requiring that disputes, including those arising under the securities laws of the
United States, between us, our officers, directors and shareholders, be subject to arbitration.
Substantially
all of our assets are located outside the United States. In addition, most of our directors and executive officers are nationals
or residents of jurisdictions other than the United States and all or a substantial portion of their assets are located outside
the United States. As a result, it may be difficult for investors to effect service of process within the United States upon
us or these persons, or to enforce judgments obtained in U.S. courts against us or them, including judgments predicated upon the
civil liability provisions of the securities laws of the United States or any state in the United States. It may also be difficult
for you to enforce judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities
laws against us and our officers and directors.
Conyers
Dill & Pearman, our counsel as to Cayman Islands law, has advised us that there is uncertainty as to whether the courts of the Cayman
Islands would (i) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers that are predicated
upon the civil liability provisions of the securities laws of the United States or any state in the United States, or (ii) entertain
original actions brought in the Cayman Islands against us or our directors or officers that are predicated upon the securities laws of
the United States or any state in the United States.
Conyers
Dill & Pearman has informed us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the
federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement
or recognition of such judgments), the courts of the Cayman Islands would recognize as a valid judgment, a final and conclusive judgment in
personam obtained in the foreign courts against our company under which a sum of money is payable (other than a sum of money
payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) or, in certain
circumstances, an in personam judgment for non-monetary relief, and would give a judgment based thereon provided that
(a) such courts had proper jurisdiction over the parties subject to such judgment, (b) such courts did not contravene the rules of natural
justice of the Cayman Islands, (c) such judgment was not obtained by fraud, (d) the enforcement of the judgment would not be contrary
to the public policy of the Cayman Islands, (e) no new admissible evidence relevant to the action is submitted prior to the rendering
of the judgment by the courts of the Cayman Islands, and (f) there is due compliance with the correct procedures under the laws of the
Cayman Islands.
We
have appointed Cogency Global Inc., 122 East 42nd Street, 18th Floor, New York, N.Y. 10168, as our agent upon whom process may be served
in any action brought against us under the securities laws of the United States.
MATERIAL
CHANGES
Except
for the consolidated financial statements for the six months ended December 31, 2020 and 2019 included below and as otherwise disclosed
in this prospectus, there have been no reportable material changes that have occurred since June 30, 2020, and that have not been
described in a report on Form 6-K furnished under the Exchange Act and incorporated by reference into this prospectus.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
CONSOLIDATED
FINANCIAL STATEMENTS
(UNAUDITED)
AS
OF DECEMBER 31, 2020 AND JUNE 30, 2020
AND
FOR
THE SIX MONTHS ENDED DECEMBER 31, 2020 and 2019
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
CONSOLIDATED
BALANCE SHEETS
(UNAUDITED)
As
of December 31, 2020 and June 30, 2020
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
43,521,074
|
|
|
$
|
25,022,199
|
|
|
Accounts receivable, net
|
|
|
1,502,961
|
|
|
|
1,774,792
|
|
|
Prepayment and other current assets
|
|
|
1,264,510
|
|
|
|
1,903,561
|
|
|
Total current assets
|
|
|
46,288,545
|
|
|
|
28,700,552
|
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
Equipment and vehicles, net
|
|
|
49,384
|
|
|
|
53,042
|
|
|
Intangible assets, net
|
|
|
41,187
|
|
|
|
43,041
|
|
|
Operating lease - right-of-use assets, net
|
|
|
6,235,091
|
|
|
|
5,951,588
|
|
|
Finance lease - right-of-use assets, net
|
|
|
1,425,309
|
|
|
|
1,398,404
|
|
|
Long-term prepayments and other non-current assets
|
|
|
4,827,660
|
|
|
|
4,449,467
|
|
|
Deferred income tax assets
|
|
|
702,316
|
|
|
|
353,097
|
|
|
Total Non-current assets
|
|
|
13,280,947
|
|
|
|
12,248,639
|
|
|
TOTAL ASSETS
|
|
$
|
59,569,492
|
|
|
$
|
40,949,191
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$
|
6,104,189
|
|
|
$
|
2,973,141
|
|
|
Advances from customers
|
|
|
2,966,952
|
|
|
|
1,414,345
|
|
|
Taxes payable
|
|
|
1,808,405
|
|
|
|
8,025
|
|
|
Current maturities of operating lease liabilities
|
|
|
224,735
|
|
|
|
199,011
|
|
|
Current maturities of finance lease liabilities
|
|
|
57,097
|
|
|
|
51,353
|
|
|
Total current liabilities
|
|
|
11,161,378
|
|
|
|
4,645,875
|
|
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
Long-term portion of operating lease liabilities
|
|
|
3,226,422
|
|
|
|
3,117,124
|
|
|
Long-term portion of finance lease liabilities
|
|
|
467,887
|
|
|
|
457,867
|
|
|
Total Non-current liabilities
|
|
|
3,694,309
|
|
|
|
3,574,991
|
|
|
TOTAL LIABILITIES
|
|
|
14,855,687
|
|
|
|
8,220,866
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, 28,000,000 shares issued and outstanding, respectively
|
|
|
2,800
|
|
|
|
2,800
|
|
|
Additional paid-in capital
|
|
|
3,667,957
|
|
|
|
3,667,957
|
|
|
Statutory reserve
|
|
|
664,100
|
|
|
|
664,100
|
|
|
Retained earnings
|
|
|
39,301,474
|
|
|
|
30,395,350
|
|
|
Accumulated other comprehensive income(loss)
|
|
|
1,113,230
|
|
|
|
(1,967,388
|
)
|
|
Total equity attributable to shareholders
|
|
|
44,749,561
|
|
|
|
32,762,819
|
|
|
Non-controlling interest
|
|
|
(35,756
|
)
|
|
|
(34,494
|
)
|
|
TOTAL SHAREHOLDERS’ EQUITY
|
|
|
44,713,805
|
|
|
|
32,728,325
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
$
|
59,569,492
|
|
|
$
|
40,949,191
|
|
The
accompanying notes are an integral part of these consolidated financial statements.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
CONSOLIDATED
STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME
(UNAUDITED)
For
the Six Months Ended December 31, 2020 and 2019
|
|
|
For the six months ended December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Revenue
|
|
|
|
|
|
|
|
Installation and maintenance
|
|
$
|
32,055,964
|
|
|
$
|
22,210,424
|
|
|
Housekeeping
|
|
|
9,630,598
|
|
|
|
7,597,993
|
|
|
Senior care
|
|
|
2,404,491
|
|
|
|
1,657,352
|
|
|
Total revenue
|
|
|
44,091,053
|
|
|
|
31,465,769
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
28,306,213
|
|
|
|
20,064,715
|
|
|
Sales and marketing expenses
|
|
|
3,027,223
|
|
|
|
2,111,044
|
|
|
General and administrative expenses
|
|
|
919,089
|
|
|
|
368,085
|
|
|
Total operating expenses
|
|
|
32,252,525
|
|
|
|
22,543,844
|
|
|
Income from operations
|
|
|
11,838,528
|
|
|
|
8,921,925
|
|
|
Other income (expenses)
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
49,333
|
|
|
|
32,868
|
|
|
Interest expenses
|
|
|
(12,820
|
)
|
|
|
(13,548
|
)
|
|
Foreign currency exchange (loss)/ gain, net
|
|
|
-
|
|
|
|
(1,042
|
)
|
|
Total other income (expenses), net
|
|
|
36,513
|
|
|
|
18,278
|
|
|
Income before income taxes
|
|
|
11,875,041
|
|
|
|
8,940,203
|
|
|
Income tax expense
|
|
|
(2,970,179
|
)
|
|
|
(2,242,784
|
)
|
|
Net income
|
|
$
|
8,904,862
|
|
|
$
|
6,697,419
|
|
|
Including:
|
|
|
|
|
|
|
|
|
|
Net income attributable to the Company’s shareholders
|
|
|
8,906,124
|
|
|
|
6,704,601
|
|
|
Net income (loss) attributable to minority interests
|
|
|
(1,262
|
)
|
|
|
(7,182
|
)
|
|
Net income
|
|
$
|
8,904,862
|
|
|
$
|
6,697,419
|
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment, net of nil tax
|
|
|
3,080,618
|
|
|
|
(355,563
|
)
|
|
Total comprehensive income
|
|
$
|
11,985,480
|
|
|
$
|
6,341,856
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share—basic and diluted
|
|
|
0.32
|
|
|
|
0.24
|
|
|
Weighted average number of ordinary shares outstanding—basic and diluted
|
|
|
28,000,000
|
|
|
|
28,000,000
|
|
The
accompanying notes are an integral part of these consolidated financial statements.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(UNAUDITED)
For
the Six Months Ended December 31, 2020 and 2019
|
|
|
Number of
Shares
|
|
|
Paid-in
capital
|
|
|
Additional
paid-in
capital
|
|
|
Statutory
reserve
|
|
|
Retained
Earnings
|
|
|
Accumulated
other
comprehensive
loss
|
|
|
Equity
attributable
to the
Company’s
shareholders
|
|
|
Non-
controlling interest
|
|
|
Total
equity
|
|
|
Balance at June 30, 2019
|
|
|
28,000,000
|
|
|
$
|
2,800
|
|
|
$
|
3,932,786
|
|
|
$
|
664,100
|
|
|
$
|
24,745,899
|
|
|
|
(1,130,348
|
)
|
|
$
|
28,215,237
|
|
|
$
|
(50,277
|
)
|
|
$
|
28,164,960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income for the period
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
6,704,601
|
|
|
|
-
|
|
|
|
6,704,601
|
|
|
|
(7,182
|
)
|
|
|
6,697,419
|
|
|
Repayment to the shareholders
|
|
|
-
|
|
|
|
-
|
|
|
|
(264,829
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(264,829
|
)
|
|
|
-
|
|
|
|
(264,829
|
)
|
|
Foreign currency translation adjustment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(355,563
|
)
|
|
|
(355,563
|
)
|
|
|
-
|
|
|
|
(355,563
|
)
|
|
Balance at December 31, 2019
|
|
|
28,000,000
|
|
|
$
|
2,800
|
|
|
$
|
3,667,957
|
|
|
$
|
664,100
|
|
|
$
|
31,450,500
|
|
|
$
|
(1,485,911
|
)
|
|
$
|
34,299,446
|
|
|
$
|
(57,459
|
)
|
|
$
|
34,241,987
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at June 30, 2020
|
|
|
28,000,000
|
|
|
$
|
2,800
|
|
|
$
|
3,667,957
|
|
|
$
|
664,100
|
|
|
$
|
30,395,350
|
|
|
$
|
(1,967,388
|
)
|
|
$
|
32,762,819
|
|
|
$
|
(34,494
|
)
|
|
$
|
32,728,325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income for the period
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
8,906,124
|
|
|
|
-
|
|
|
|
8,906,124
|
|
|
|
(1,262
|
)
|
|
|
8,904,862
|
|
|
Foreign currency translation adjustment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3,080,618
|
|
|
|
3,080,618
|
|
|
|
-
|
|
|
|
3,080,618
|
|
|
Balance at December 31, 2020
|
|
|
28,000,000
|
|
|
$
|
2,800
|
|
|
$
|
3,667,957
|
|
|
$
|
664,100
|
|
|
$
|
39,301,474
|
|
|
$
|
1,113,230
|
|
|
$
|
44,749,561
|
|
|
$
|
(35,756
|
)
|
|
$
|
44,713,805
|
|
The
accompanying notes are an integral part of these consolidated financial statements.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(UNAUDITED)
For
the Six Months Ended December 31, 2020 and 2019
|
|
|
For the six months ended December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Cash generated from operating activities
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,904,862
|
|
|
$
|
6,697,419
|
|
|
Income tax expense
|
|
|
2,970,179
|
|
|
|
2,242,784
|
|
|
Interest expense
|
|
|
12,820
|
|
|
|
13,548
|
|
|
Depreciation and amortization
|
|
|
350,982
|
|
|
|
404,632
|
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
|
|
|
Accounts receivables, net
|
|
|
271,831
|
|
|
|
592,886
|
|
|
Prepayment and other current assets
|
|
|
619,103
|
|
|
|
202,907
|
|
|
Long-term prepayments and other non-current assets
|
|
|
(378,193
|
)
|
|
|
56,084
|
|
|
Accounts payable and accrued expenses
|
|
|
4,713,298
|
|
|
|
225,610
|
|
|
Taxes payable
|
|
|
(1,499,070
|
)
|
|
|
(2,075,014
|
)
|
|
Cash provided by operating activities
|
|
|
15,965,812
|
|
|
|
8,360,856
|
|
|
Investing Activities
|
|
|
|
|
|
|
|
|
|
Purchases of intangible assets
|
|
|
-
|
|
|
|
(42,751
|
)
|
|
Capitalized leasehold costs
|
|
|
(244,859
|
)
|
|
|
(217,469
|
)
|
|
Cash (used in) investing activities
|
|
|
(244,859
|
)
|
|
|
(260,220
|
)
|
|
Financing Activities
|
|
|
|
|
|
|
|
|
|
Repayment to the shareholders
|
|
|
-
|
|
|
|
(249,381
|
)
|
|
Cash (used in) financing activities
|
|
|
-
|
|
|
|
(249,381
|
)
|
|
Net increase in cash and cash equivalents
|
|
|
15,720,953
|
|
|
|
7,851,255
|
|
|
Effects of currency translation
|
|
|
2,777,922
|
|
|
|
(361,400
|
)
|
|
Cash and cash equivalents at beginning of period
|
|
|
25,022,199
|
|
|
|
23,229,372
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
43,521,074
|
|
|
$
|
30,719,227
|
|
|
SUPPLEMENTAL DISCLOSURES
|
|
|
|
|
|
|
|
|
|
Income taxes paid
|
|
$
|
1,509,091
|
|
|
$
|
2,068,391
|
|
|
Interest paid
|
|
$
|
12,820
|
|
|
$
|
13,548
|
|
The
accompanying notes are an integral part of these consolidated financial statements.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
1 – ORGANIZATION AND NATURE OF OPERATIONS
E-Home
Household Service Holdings Limited (the “Company”) was incorporated as a limited company under the law of Cayman Islands
on September 24, 2018. The Company does not conduct any substantive operations on its own but instead conducts its business operations
through its subsidiaries, variable interest entity (“VIE”) and subsidiaries of the VIE. The Company, its subsidiaries, VIE
and subsidiaries of the VIE are hereinafter collectively referred to as the “Group”. The Company is principally engaged in
the operation of household services, e.g. installation and maintenance of home appliances, housekeeping and senior care in the People’s
Republic of China (the “PRC”) through on-line APP platform or call center. As described below, the Company, through a series
of transactions which is accounted for as a reorganization of entities under common control (the “Reorganization”), became
the ultimate parent entity of its subsidiaries, VIE and subsidiaries of VIE. Accordingly, these consolidated financial statements reflect
the historical operations of the Company as if the current organization structure had been in existence throughout the periods presented.
Reorganization
In
preparation of its initial public offering in the United States (“IPO”), the following transactions were undertaken to reorganize
the legal structure of the Company. The reorganization involved (i) the incorporation of the Company in the Cayman Islands as a holding
company; (ii) the establishment of E-Home Household Service Holdings Limited (“E-Home Hong Kong”) as a wholly-owned subsidiary
in Hong Kong, PRC; (iii) the establishment of E-Home Household Service Technology Co., Ltd. (“WOFE”), as a wholly-owned subsidiary
of E-Home Hong Kong in Fujian, PRC; (iv) the entry by WFOE into contractual arrangements with Pingtan Comprehensive Experimental Area
E Home Service Co., Ltd. (“E-Home Pingtan”) and Fuzhou Bangchang Technology Co. Ltd. (“Fuzhou Bangchang”) and
their shareholders. The Company, E-Home Hong Kong and WFOE are all holding companies and had not commenced operation until this reorganization
was complete. A reorganization of the Group’s legal structure was completed in February 2019.
As
all the entities involved in the process of the Reorganization are under common control before and after the Reorganization, the Reorganization
is accounted for in a manner similar to a pooling-of-interest with the assets and liabilities of the parties to the Reorganization carried
over at their historical amounts.
The
Company’s major consolidated subsidiaries, VIEs and their subsidiaries are as follows:
|
Name
|
|
Date
of
Organization
|
|
Place
of
Organization
|
|
% of
Ownership
|
|
|
E-Home
Household Service Holdings Limited
|
|
October
16, 2018
|
|
Hong
Kong
|
|
100%
|
|
|
E-Home
Household Service Technology Co., Ltd.
|
|
December
5, 2018
|
|
PRC
|
|
100%
|
|
|
Pingtan
Comprehensive Experimental Area E Home Service Co., Ltd.
|
|
April
1, 2014
|
|
PRC
|
|
VIE
|
|
|
Fuzhou
Bangchang Technology Co. Ltd.
|
|
March
15, 2007
|
|
PRC
|
|
VIE
|
|
|
Fuzhou
Yongheng Xin Electric Co., Ltd.
|
|
October
12, 2004
|
|
PRC
|
|
100%
|
|
|
Fujian
Happiness Yijia Family Service Co., Ltd.
|
|
January
19, 2015
|
|
PRC
|
|
67%
|
|
|
Fuzhou
Yiyanbao Information Technology Co., Ltd.
|
|
August
13, 2016
|
|
PRC
|
|
67%
|
|
|
Yaxing
Human Resource Management (Pingtan) Co., Ltd.
|
|
July
6, 2018
|
|
PRC
|
|
51%
|
|
The
Company was incorporated as an exempted company with limited liability under the laws of the Cayman Islands on September 24, 2018. The
Company has no substantive operations other than holding 100% of the equity or ownership of Ehome Hong Kong, a limited company established
under the laws of the Hong Kong on October 16, 2018. E-Home Hong Kong is a holding company of 100% of the equity or ownership of WFOE,
a limited company established under the laws of the PRC on December 5, 2018.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
On December 18, 2018, WFOE entered into contractual
arrangements with E-Home Pingtan and Fuzhou Bangchang, two limited liability companies established under the laws of the PRC on April
1, 2014 and March 15, 2007, respectively.
E-Home Pingtan is a holding company of the following
subsidiaries: (i) 100% of the equity interests of Pingtan Comprehensive Experimental Zone Chuangkejin Enterprise Management Co., Ltd.
(“CKJ”), a limited liability company established under the laws of the PRC on August 13, 2015, which was dissolved on November
1, 2018; (ii) 100% of the equity interests of Fuzhou Yongheng Xin Electric Co., Ltd. (“YHX”), a limited liability company
established under the laws of the PRC on October 12, 2004; (iii) 100% of the equity interests ofYichang Yijia Fast Service Home Service
Co., Ltd. (“YJJJ”), a limited liability company established under the laws of the PRC on April 24, 2015, which was dissolved
on September 18, 2017; (iv) 67% of the equity interests of Pingtan Comprehensive Experimental Zone Yili Sending Co., Ltd. (“YLS”),
a limited liability company established under the laws of the PRC on August 13, 2015, which had no operations, was dissolved on April
26, 2020; (v) 67% of the equity interests of Fujian Happiness Yijia Family Service Co., Ltd. (“HAPPY”), a limited liability
company established under the laws of the PRC on January 19, 2015; (vi) 67% of the equity interests of Fuzhou Yiyanbao Information Technology
Co., Ltd. (“YYB”), a limited liability company established under the laws of the PRC on August 13, 2016, (vii)51% of the equity
interests of Fuzhou Yijia KuaiFu Investment Consulting Co.,Ltd. (“YJZX”),a limited liability company established under the
laws of the PRC on June 1,2018, which was dissolved on December 11, 2018; and (viii) 51% of the equity interests of Yaxing Human Resource
Management (Pingtan) Co.,Ltd. (“HR”), a limited liability company established under the laws of the PRC on July 6, 2018. YYB
has not yet commenced operations.
The accompanying consolidated financial statements
include the financial statements of the Company, its subsidiaries, consolidated VIEs and VIEs’ subsidiaries.
Contractual Arrangements
To comply with PRC laws and regulations, the Group
provides all of its services in China through E-Home Pingtan and Fuzhou Bangchang. Under various contractual agreements, WFOE has the
exclusive right to acquire the ownership of E-Home Pingtan and Fuzhou Bangchang for a nominal consideration, or an adjusted price based
on appraisal if required by the PRC laws, when permitted by PRC laws and regulations at the request of WFOE any time. All voting rights
of E-Home Pingtan and Fuzhou Bangchang are assigned to WFOE and WFOE has the right to appoint all directors and senior management personnel
of E-Home Pingtan and Fuzhou Bangchang. In addition, all shareholders of E-Home Pingtan and Fuzhou Bangchang have pledged their shares
in E-Home Pingtan and Fuzhou Bangchang as collateral. As a result, the Company enjoys substantially all of the risks and rewards of ownership
of E-Home Pingtan and Fuzhou Bangchang and exercises controls over them, along with their subsidiaries. Therefore, the Company is the
ultimate primary beneficiary of E-Home Pingtan and Fuzhou Bangchang and has consolidated E-Home Pingtan and Fuzhou Bangchang and its subsidiaries.
The following is a summary of the contractual
agreements:
Exclusive Business Cooperation Agreements
Under the Exclusive Business Cooperation Agreement
between WFOE and E-Home Pingtan, dated February 22, 2019, and the Exclusive Business Cooperation Agreement between WFOE and Fuzhou Bangchang,
dated February 20, 2019, WFOE has the exclusive right to provide E-Home Pingtan and Fuzhou Bangchang with technical support, consulting
services and other services related to their business operations in return for certain fees. Without WFOE’s prior written consent,
E-Home Pingtan and Fuzhou Bangchang may not accept any services subject to these agreements from any third party. The parties shall determine
the service fees to be charged to E-Home Pingtan and Fuzhou Bangchang under these agreements by considering, among other things, the complexity
of the services, the time that may be spent for providing such services, the commercial value and specific content of the service provided,
the market price of the same types of services, and the operating condition of E-Home Pingtan and Fuzhou Bangchang. WFOE owns the intellectual
property rights developed by either WFOE or E-Home Pingtan and Fuzhou Bangchang in the performance of the agreement. These agreements
became effective upon execution and will remain effective until terminated by WFOE.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Equity Interest Pledge Agreements
Under the Equity Interest Pledge Agreement among
WFOE, E-Home Pingtan and its shareholders, dated February 22, 2019, and the Equity Interest Pledge Agreement among WFOE, Fuzhou Bangchang
and its shareholders, dated February 20, 2019, the shareholders have pledged their respective equity interests in E-Home Pingtan and Fuzhou
Bangchang to secure their performance under the Exclusive Business Corporation Agreements, the Exclusive Option Agreements, the Voting
Rights Proxy and Financial Supporting Agreements and the Equity Interest Pledge Agreements. If E-Home Pingtan and Fuzhou Bangchang or
the shareholders breach their contractual obligations under these agreements, WFOE, as pledgee, will have the right to dispose of the
pledged equity interests in E-Home Pingtan and Fuzhou Bangchang and will have priority in receiving the proceeds from such disposal. The
shareholders also agreed that, unless the contractual obligations as defined in the Equity Interest Pledge Agreements are fully performed
by them or the secured debts under the Equity Interest Pledge Agreements are paid in full (whichever later), they will not dispose of
the pledged equity interests or create or allow any encumbrance on the pledged equity interests. During the equity pledge period, WFOE
is entitled to all dividends and other distributions made by E-Home Pingtan and Fuzhou Bangchang. The Equity Interest Pledge Agreements
will remain binding until E-Home Pingtan and Fuzhou Bangchang discharge all their obligations under the Exclusive Business Corporation
Agreements at the expiration of the Exclusive Business Corporation Agreements.
Exclusive Option Agreements
Under the Exclusive Option Agreement among WFOE,
E-Home Pingtan and its shareholders, dated February 22, 2019, and the Exclusive Option Agreement among WFOE, Fuzhou Bangchang and its
shareholders, dated February 20, 2019, the shareholders irrevocably granted WFOE or any third party designated by WFOE an exclusive option
to purchase all or part of their equity interests in E-Home Pingtan and Fuzhou Bangchang at a price of RMB 10; provided that if the lowest
price permitted by applicable PRC laws is greater than RMB 10, then that price shall apply. The shareholders further agreed that they
will neither create any pledge or encumbrance on their equity interests in E-Home Pingtan and Fuzhou Bangchang, nor transfer, gift or
otherwise dispose of their equity interests in E-Home Pingtan and Fuzhou Bangchang to any person other than WFOE or its designated third
party. The shareholders and E-Home Pingtan and Fuzhou Bangchang agreed that they will operate the businesses in the ordinary course and
maintain the asset value of E-Home Pingtan and Fuzhou Bangchang and refrain from any actions or omissions that may affect their operating
status and asset value. Furthermore, without WFOE’s prior written consent, the shareholders and E-Home Pingtan and Fuzhou Bangchang
agreed not to, among other things: amend the articles of association of E-Home Pingtan and Fuzhou Bangchang; increase or decrease the
registered capital of E-Home Pingtan and Fuzhou Bangchang; sell, transfer, mortgage or dispose of in any manner any material assets of
E-Home Pingtan and Fuzhou Bangchang or legal or beneficial interest in the material business or revenues of E-Home Pingtan and Fuzhou
Bangchang of more than RMB 10,000,000; enter into any major contracts, except for contracts in the ordinary course of business (a contract
with a price exceeding RMB 500,000 shall be deemed a major contract); merge, consolidate with, acquire or invest in any person, or provide
any loans; or distribute dividends. The Exclusive Option Agreements will remain effective until all equity interests have been transferred
or assigned in accordance with the Exclusive Option Agreements.
Voting Rights Proxy and Financial Supporting
Agreements
Pursuant to the Voting Rights Proxy and Financial
Supporting Agreement among WFOE, E-Home Pingtan and its shareholders, dated February 22, 2019, and the Voting Rights Proxy and Financial
Supporting Agreement among WFOE, Fuzhou Bangchang and its shareholders, dated February 20, 2019, each shareholder irrevocably authorized
WFOE or any person(s) designated by WFOE to act as his or her attorney-in-fact to exercise all of his or her rights as a shareholder of
E-Home Pingtan and Fuzhou Bangchang, including, but not limited to, the right to convene shareholders’ meetings, vote and sign any
resolution as a shareholder, appoint directors and other senior executives to be appointed and removed by the shareholder, the right to
sell, transfer, pledge and dispose of all or a portion of the shares held by such shareholder, and other shareholders voting rights permitted
by the articles of association of E-Home Pingtan and Fuzhou Bangchang. In consideration of the foregoing grant of voting rights by the
shareholders, WFOE agreed to arrange for funds to be provided as necessary to E-Home Pingtan and Fuzhou Bangchang in connection with their
business; provided that in the event that the business of E-Home Pingtan or Fuzhou Bangchang fails and as a result E-Home Pingtan or Fuzhou
Bangchang is unable to repay such funds, then E-Home Pingtan or Fuzhou Bangchang shall have no repayment obligation. The term of the Voting
Rights Proxy and Financial Supporting Agreements is for twenty years, which may be extended upon written consent of the parties.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Risks in Relation to the VIE Structure
Under the contractual arrangements with E-Home
Pingtan and Fuzhou Bangchang and through their equity interest in their subsidiaries, the Group has the power to direct activities of
the VIEs and VIEs’ subsidiaries and direct the transfer of assets out of the VIEs and VIEs’ subsidiaries. Therefore, the Group
considers that there is no asset of the VIEs and VIEs’ subsidiaries that can be used only to settle their obligations. As the consolidated
VIEs and VIEs’ subsidiaries are incorporated as limited liability companies under the PRC Company Law, the creditors do not have
recourse to the general credit of the Company for all the liabilities of the consolidated VIEs and VIEs’ subsidiaries.
The Group believes that the contractual arrangements
among the WFOE, E-Home Pingtan and Fuzhou Bangchang and their respective shareholders are in compliance with PRC law and are legally enforceable.
Some of the shareholders of E-Home Pingtan and Fuzhou Bangchang are also shareholders or nominees of shareholders of the Company and therefore
have no current interest in seeking to act contrary to the contractual arrangements. However, uncertainties in the PRC legal system could
limit the Company’s ability to enforce these contractual arrangements and if the shareholders of E-Home Pingtan and Fuzhou Bangchang
were to reduce their interest in the Company, their interests may diverge from that of the Company and that may potentially increase the
risk that they would seek to act contrary to the contractual terms.
The Company’s ability to control E-Home
Pingtan and Fuzhou Bangchang also depends on the power of attorney and WFOE has to vote on all matters requiring shareholder approval
in E-Home Pingtan and Fuzhou Bangchang. As noted above, the Company believes this power of attorney is legally enforceable but may not
be as effective as direct equity ownership.
In addition, if the legal structure and contractual
arrangements were found to be in violation of any existing PRC laws and regulations, the PRC government could:
|
|
●
|
revoke the Group’s business
and operating licenses;
|
|
|
●
|
require the Group to discontinue or restrict operations;
|
|
|
●
|
restrict the Group’s right to collect revenues;
|
|
|
●
|
block the Group’s websites;
|
|
|
●
|
require the Group to restructure the operations in such a way as to compel the Group to establish a new enterprise, re-apply for the necessary licenses or relocate our businesses, staff and assets;
|
|
|
●
|
impose additional conditions or requirements with which the Group may not be able to comply; or
|
|
|
●
|
take other regulatory or enforcement actions against the Group that could be harmful to the Group’s business.
|
The imposition of any of these penalties may result
in a material and adverse effect on the Group’s ability to conduct the Group’s business. In addition, if the imposition of
any of these penalties causes the Group to lose the right to direct the activities of E-Home Pingtan and Fuzhou Bangchang (through the
equity interest in their subsidiaries) or the right to receive their economic benefits, the Group would no longer be able to consolidate
E-Home Pingtan and Fuzhou Bangchang and their subsidiaries. In the opinion of management, the likelihood of loss in respect of the Group’s
current ownership structure or the contractual arrangements with its VIEs are remote.
There is no VIE for which the Company has variable
interest but is not the primary beneficiary.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Except as described above, there is no contractual
arrangement that could require the Company to provide additional financial support to E-Home Pingtan and Fuzhou Bangchang. As the Company
is conducting its business mainly through E-Home Pingtan and Fuzhou Bangchang, the Company may provide such support on a discretionary
basis in the future, which could expose the Company to a loss.
The assets within the Company’s VIEs are
comprised of recognized and unrecognized revenue-producing assets. The recognized revenue producing assets mainly include software copyright,
which were in the line of “Intangible assets, net” in the table above. The unrecognized revenue-producing assets mainly consist
of trademarks, which have no recorded value.
NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES
Interim Financial Statements
These unaudited consolidated financial statements
have been prepared in accordance with generally accepted accounting principles in the United States (“US GAAP”) for interim
financial information and with the instructions to Form 20-F and Regulation S-X. Accordingly, the consolidated financial statements do
not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments considered necessary for a fair presentation have been included and such adjustments are
of a normal recurring nature. These consolidated financial statements should be read in conjunction with the consolidated financial statements
for the year ended June 30, 2020 and notes thereto and other pertinent information contained in the Form 20-F that the Company has filed
with the Securities and Exchange Commission (the “SEC”) on November 16, 2020. The results of operations for the six months
ended December 31, 2020, are not necessarily indicative of the results to be expected for the full fiscal year ending June 30, 2021.
Principles of Consolidation
The consolidated financial statements of the Group
have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
The consolidated financial statements include the financial statements of the Company, its subsidiaries, the VIEs and VIEs’ subsidiaries
for which the Company is the ultimate primary beneficiary.
Subsidiaries are those entities in which the Company,
directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies,
to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.
A VIE is an entity in which the Company or its
subsidiary, through contractual arrangements, bears the risks of, and enjoys the rewards normally associated with, ownership of the entity,
and therefore the Company or its subsidiary is the primary beneficiary of the entity.
All significant transactions and balances among
the Company, its subsidiaries, the VIEs and VIEs’ subsidiaries have been eliminated upon consolidation.
COVID-19 Considerations
In December 2019, a novel strain of coronavirus
was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout China and other parts of the world, including
the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public
Health Emergency of International Concern,” and on March 11, 2020, the World Health Organization characterized the outbreak as a
“pandemic.” Governments in affected countries are imposing travel bans, quarantines and other emergency public health measures,
which have caused material disruption to businesses globally resulting in an economic slowdown. These measures, though temporary in nature,
may continue and increase depending on developments in the COVID-19’s outbreak.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
We have experienced some disruption to our business
during the Chinese government mandated lockdown in February 2020. As a result of these unexpected disruptions, we suspended our business
for two weeks (from January 24, 2020 to February 6, 2020) according to the instruction of the local government, related to COVID-19 and
after the brief suspension the Company returned to normal operations.
In response to governmental directives and recommended
safety measures, we have implemented personal safety measures at all our facilities.
In the longer-term, the COVID-19 pandemic is likely
to adversely affect the economies and financial markets of many countries, and could result in a global economic downturn and a recession.
This would likely adversely affect our business in turn negatively impact our results of operations.
While we continue to see an increasing demand
for our services, the environment remains uncertain and it may not be sustainable over the longer term. The degree to which the pandemic
ultimately impacts our business and results of operations will depend on future developments beyond our control, including the severity
of the pandemic, the extent of actions to contain or treat the virus, how quickly and to what extent normal economic and operating conditions
can resume, and the severity and duration of the global economic downturn that results from the pandemic.
Use of Estimates
In preparing the consolidated financial statements
in conformity with US GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses
during the reporting period. These estimates are based on information as of the date of the consolidated financial statements. Significant
estimates required to be made by management include, but are not limited to, the valuation of accounts receivable, useful lives of property
and equipment and intangible assets, the recoverability of long-lived assets and provision necessary for contingent liabilities. Actual
results could differ from those estimates.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand,
cash accounts, interest bearing savings accounts and time certificates of deposit with a maturity of three months or less when purchased.
The Group considers all highly liquid investment instruments with an original maturity of three months or less from the date of purchase
to be cash equivalents. The Group maintains most of the bank accounts in the PRC. Cash balances in bank accounts in PRC are not insured
by the Federal Deposit Insurance Corporation or other programs.
Accounts Receivable, Net
Accounts receivable are recognized and carried
at original invoiced amount less an estimated allowance for uncollectible accounts. The Group usually determines the adequacy of reserves
for doubtful accounts based on individual account analysis and historical collection trends. The Group establishes a provision for doubtful
receivables when there is objective evidence that the Group may not be able to collect amounts due. The allowance is based on management’s
best estimates of specific losses on individual exposures, as well as a provision on historical trends of collections. Based on management
of customers’ credit and ongoing relationship, management makes conclusions whether any balances outstanding at the end of the period
will be deemed uncollectible on an individual basis and on aging analysis basis. The provision is recorded against accounts receivables
balances, with a corresponding charge recorded in the consolidated statements of income and comprehensive income. Delinquent account balances
are written-off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Equipment and vehicles, net
Equipment and vehicles are stated at cost less
accumulated depreciation. Maintenance and repairs are charged to expense as incurred. Depreciation is provided on the straight-line method
based on the estimated useful lives of the assets as follows:
|
|
|
Useful Lives
|
|
Office Equipment
|
|
5 Years
|
|
Electronic Equipment
|
|
5 Years
|
|
Motor Vehicles
|
|
10 Years
|
Expenditures for maintenance and repairs, which
do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterment
which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired
or sold are removed from the respective accounts, and any gain or loss is recognized in the consolidated statements of income and other
comprehensive income in other income or expenses.
Intangible assets, net
Intangible assets consist of only acquired software.
The Group has purchased software from third parties used for operation management. Software and Senior care service App are initially
recorded at cost and amortized on a straight-line basis over the estimated economic useful life of 10 and 5 years, respectively.
IPO Expense
IPO expense consist of consulting fees paid to
underwriters, lawyers and auditors, are typically treated as prepayments before listing, while after listing, it would be treated as a
reduction of capital reserves.
Impairment of Long-Lived Assets
Long-lived assets are reviewed for impairment
when events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. Long-lived assets with
carrying values that are not expected to be recovered through future cash flows are written down to their estimated fair values. The carrying
value of a long-lived asset is deemed not recoverable if it exceeds the sum of undiscounted cash flows expected to result from the use
and eventual disposition of the asset. If the asset’s carrying value exceeds the sum of its undiscounted cash flows, a non-cash
asset impairment charge equals to the excess of the asset’s carrying value over its estimated fair value is recorded. Fair value
is defined as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market
participants at a specified measurement date. We measure fair value using market price indicators or, in the absence of such data, appropriate
valuation technique.
Leases
Leases are classified at lease commencement date
as either a finance lease or an operating lease. A lease is a finance lease if it meets any of the following criteria: (a) the lease transfers
ownership of the underlying asset to the lessee by the end of the lease term, (b) the lease grants the lessee an option to purchase the
underlying asset that the lessee is reasonably certain to exercise, (c) the lease term is for the major part of the remaining economic
life of the underlying asset, (d) the present value of the sum of the lease payments and any residual value guaranteed by the lessee that
is not already reflected in the lease payments equals or exceeds substantially all of the fair value of the underlying asset or (e) the
underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease
term. When none of the criteria meets, the lease shall be classified as an operating lease.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
For lessee, a lease is recognized as a right-of-use
asset with a corresponding liability at lease commencement date. The lease liability is calculated at the present value of the lease payments
not yet paid by using the lease term and discount rate determined at lease commencement. The right-of-use asset is calculated as the lease
liability, increased by any initial direct costs and prepaid lease payments, reduced by any lease incentives received before lease commencement.
The right-of-use asset itself is amortized on a straight-line basis unless another systematic method better reflects how the underlying
asset will be used by and benefits the lessee over the lease term.
In February 2016, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842). The amendments in this
ASU require an entity to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition,
measurement and presentation of expenses will depend on classification as a finance or operating lease. The amendments also require certain
quantitative and qualitative disclosures about leasing arrangements. The Company adopted ASC 842 effective as of the beginning of the
first period (the fiscal year ended June 30, 2018) presented by using a modified retrospective transition approach in the accompanying
financial statements of the Company. The adoption of this standard had a material impact on the Company’s financial position, with
no material impact on the results of operations and cash flows (see Notes 7 and 8).
Fair Value of Financial Instruments
The fair value of a financial instrument is defined
as the exchange price that would be received from an asset or paid to transfer a liability (as exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market participants at the measurement date. The carrying amounts
of financial assets and liabilities, such as cash and cash equivalents, time deposits, accounts receivable, prepaid expenses and other
current assets, accounts payable, and other current liabilities, approximate their fair values because of the short maturity of these
instruments and market rates of interest.
ASC 825-10 requires certain disclosures regarding
the fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes
the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of
unobservable inputs. The three levels of inputs used to measure fair value are as follows:
Level 1 - Quoted prices in active markets
for identical assets and liabilities.
Level 2 - Quoted prices in active markets
for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for
substantially the full term of the financial instrument.
Level 3 - Unobservable inputs that
are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes
certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
The Group considers the carrying amount of its
financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, prepayment and operating
lease, accounts payable and taxes payable approximate the fair value of the respective assets and liabilities as of December 31, 2020
and June 30, 2020 owing to their short-term or present value nature.
Revenue Recognition
The Group adopted Accounting Standards Codification
No. 606, Revenue from Contracts with Customers (ASC 606) beginning January 1, 2018 and elected to adopt ASC 606 under the modified retrospective
method. This guidance was applied retrospectively to the most current period presented in the Company’s consolidated financial statements.
The adoption of ASC 606 did not have a material impact on the consolidated financial statements of the Company.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The Group generates revenues primarily from installation
& maintenance and housekeeping services. The Group sells its services through a third-party service provider WeChat platform. The
Group’s revenues are subject to value added tax (“VAT”). To record VAT payable, the Group uses the gross presentation
method, which presents the taxable services and the available input VAT amount (at the rate applicable to the supplier). Revenues are
recorded net of VAT in accordance with the ASC 606. The recognition of revenues involves certain management judgments. The amount and
timing of our revenues could be materially different for any period if management made different judgments or utilized different estimates.
(i) Installation and Maintenance
Installation and maintenance services mainly consisting
of the following services: technical home installation and repair, maintenance and other after sale services. Revenues from installation
and maintenance services are recognized at a point in time once the service is transferred to the customer. For service arrangements that
include multiple performance obligations, revenues are allocated to each performance obligation based on its standalone selling price.
The Group allocates arrangement consideration in multiple-deliverable revenue arrangements at the inception of an arrangement to all deliverables
based on the relative selling price method, generally based on the best estimate of selling price. The Group, acting as principal, contracts
with third-party service providers (i.e., service outlets), acting as agents. The Group is responsible for market development and providing
the customer information to the service provider, directing the outlet to provide services and coordination with the customer, while the
service provider provides the door-to-door service. The price of services is set by the Group and the service provider is only responsible
for collection of payments. When the Group’s end customers place orders online for services, they pay either a required visit fee
or the estimated full amount of service fee through third-party payment platforms, such as WeChat Pay and Alipay. The Group chooses the
service provider by the proximity principle. If the customer is not satisfied with the chosen provider, the service provider can be re-selected.
Regardless of the service provider’s performance, the Group is still liable to complete the orders. If the end customer fails to
pay after satisfactory service is provided and the service provider is unable to collect payment from the end customer, the Group will
communicate directly with the end customer. The service provider is not obligated to pay the Group. To minimize our risk, the service
provider will remit payment of any outstanding receivables each month.
(ii) Housekeeping
Housekeeping services refer to services including
housecleaning, nanny service, maternity matron and personnel staffing. Revenues from housekeeping are recognized at a point in time once
the service is transferred to the customer based on the relative selling price method.
(iii) Senior care services
Senior care services refer to services provided
through the company’s E-watch, which include blood pressure monitoring, heart rate analytics, daily steps count, location and track
record, call for help through WeChat or phone, and other care services rendered to senior customers through an E-watch, which is provided
to customers when they pay the annual fees. The customers sign a contract for the services with the Company. The contract term is normally
one year. The revenues from senior care services are generated from E-watch sales and related E-watch monitoring services provided. Revenues
from E-watch sales are recognized at a point in time once customers receive the E-watch and the revenues of the services provided are
recognized over the contractual service period.
Senior care services consist of the sale of E-watches
and related care services. The E-watch is not sold to customers separately; the E-watch is sold only in conjunction with a contract to
provide senior care services, which are facilitated through the E-watch. The service can be renewed as long as the customers continue
to pay annual fees. Normally the service period is one year and the renewal annual fee is RMB 699. Consequently, the Company regards these
operating activities as operating in one material segment, being the revenue of senior care services.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Cost of Revenues
Cost of revenue consists of service fees paid
to staff, outlets, suppliers and the cost of accessories sold.
Income Taxes
Income taxes are provided on an asset and liability
approach for financial accounting and reporting of income taxes. Any PRC tax paid by subsidiaries during the year is recorded. Deferred
income taxes are recognized for all significant temporary differences at enacted rates and classified as current or non-current based
upon the classification of the related asset or liability in the financial statements. A valuation allowance is provided to reduce the
amount of deferred tax assets if it is considered more likely than not that some portion of, or all, the deferred tax asset will not be
realized.
Ordinary Shares
The Company accounts for repurchased ordinary
shares under the cost method and include such treasury stock as a component of the common shareholders’ equity. Cancellation of
treasury stock is recorded as a reduction of ordinary shares, additional paid-in capital and retained earnings, as applicable. An excess
of purchase price over par value is allocated to additional paid-in capital first with any remaining excess charged entirely to retained
earnings.
Related Parties
Parties are considered to be related if one party
has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial
and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such
as a family member or relative, shareholder, or a related corporation.
Earnings Per Share
The Company computes earnings per share (“EPS”)
in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies with complex capital structures to present basic
and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary shares outstanding for the period. Diluted
EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential ordinary shares (e.g., convertible securities,
options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary
shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the
calculation of diluted EPS. There were no potentially dilutive ordinary shares during the periods ended December 31, 2020 and 2019.
Foreign Currency Translation
The Group’s principal country of operations
is the PRC. The financial position and results of its operations are determined using RMB, the local currency, as the functional currency.
The consolidated financial statements are reported using U.S. Dollars. The results of operations and the statement of cash flows denominated
in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in
foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated
in the functional currency is translated at the historical rate of exchange at the time of capital contribution. Because cash flows are
translated based on the average translation rate, amounts related to assets and liabilities reported on the consolidated statements of
cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments
arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive
income (loss) included in consolidated statements of changes in equity. Gains and losses from foreign currency transactions are included
in the consolidated statement of income and comprehensive income.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The value of RMB against U.S. Dollar may fluctuate
and is affected by, among other things, changes in the PRC’s political and economic conditions. Any significant revaluation of RMB
may materially affect the Company’s consolidated financial condition in terms of U.S. Dollar reporting. The following table outlines
the currency exchange rates that were used in the consolidated financial statements:
|
|
|
June 30,
2020
|
|
June 30,
2019
|
|
Year-end spot rate
|
|
US$1=7.0795 RMB
|
|
US$1= 6.8747 RMB
|
|
Average rate
|
|
US$1=7.0293 RMB
|
|
US$1= 6.8260 RMB
|
|
|
|
December 31,
2020
|
|
December 31,
2019
|
|
Period-end spot rate
|
|
US$1=6.5249 RMB
|
|
US$1= 6.9762 RMB
|
|
Average rate for six months ended
|
|
US$1=6.7470 RMB
|
|
US$1= 7.0174 RMB
|
Comprehensive Income/(Loss)
Comprehensive income/(loss) is defined as the
change in equity of the Group during a period arising from transactions and other events and circumstances excluding transactions resulting
from investments by shareholders and distributions to shareholders. Comprehensive income or loss is reported in the consolidated statements
of comprehensive income/(loss). Accumulated other comprehensive income/ (loss), as presented on the accompanying consolidated balance
sheets, consists of accumulated foreign currency translation adjustments.
Segment Reporting
Operating segments, and the amounts of each segment
item reported in the consolidated financial statements, are identified from the financial information provided regularly to the Group’s
most senior executive management for the purposes of allocating resources to, and assessing the performance of, the Group’s various
lines of business and geographical locations.
Individually material operating segments are not
aggregated for financial reporting purposes unless the segments have similar economic characteristics and are similar in respect of the
nature of products and services, the nature of production processes, the type or class of customers, the methods used to distribute the
products or provide the services, and the nature of the regulatory environment. Operating segments which are not individually material
may be aggregated if they share a majority of these criteria. The Group’s three segments are installation and maintenance, housekeeping
and senior care. Test operations for senior care began in August, 2019.
Commitments and Contingencies
The Company follows subtopic 450-20 of the FASB
Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the consolidated
financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events
occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.
There are no known commitments or contingencies as of December 31, 2020 or June 30, 2020.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Concentration of Risks
Exchange Rate Risks
The Company’s Chinese subsidiaries may be
exposed to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between the U.S.
Dollar and the RMB. As of December 31, 2020 and June 30, 2020, the RMB denominated cash and cash equivalents amounted to $ 43,521,074
and $25,022,199, respectively.
Currency Convertibility Risks
Substantially all of the Group’s operating
activities are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place
either through the People’s Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted
by the People’s Bank of China. Approval of foreign currency payments by the People’s Bank of China or other regulatory institutions
requires submitting a payment application form together with other information such as suppliers’ invoices, shipping documents and
signed contracts.
Concentration of Credit Risks
Financial instruments that potentially subject
the Group to concentration of credit risks consist primarily of cash and cash equivalents and accounts receivable, the balances of which
stated on the consolidated balance sheets represented the Group’s maximum exposure. The Group places its cash and cash equivalents
in good credit quality financial institutions in China. Concentration of credit risks with respect to accounts receivables is linked to
the concentration of revenue. To manage credit risk, the Group performs ongoing credit evaluations of customers’ financial condition.
Risks and Uncertainties
The operations of the Group are located in the
PRC. Accordingly, the Group’s business, financial condition, and results of operations may be influenced by political, economic,
and legal environments in the PRC, as well as by the general state of the PRC economy. The Group’s results may be adversely affected
by changes in the political, regulatory and social conditions in the PRC. Although the Group has not experienced losses from these situations
and believes that it is in compliance with existing laws and regulations including its organization and structure disclosed in Note 1,
this may not be indicative of future results.
Recent Accounting Pronouncements
The Group considers the applicability and impact
of all ASUs. Management periodically reviews new accounting standards that are issued.
Recently Adopted Accounting Standards:
In June 2016, the FASB issued ASU No. 2016-13,
“Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. This amends guidelines
on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. For assets held at amortized
cost basis, Topic 326 eliminates the probable initial recognition threshold in current U.S. GAAP and, instead, requires an entity to reflect
its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized
cost basis of the financial assets to present the net amount expected to be collected. For available-for-sale debt securities, credit
losses should be measured in a manner similar to current U.S. GAAP, however Topic 326 will require that credit losses be presented as
an allowance rather than as a write-down. ASU 2016-13 affects entities holding financial assets and net investment in leases that are
not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in
leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have
the contractual right to receive cash. The amendments in this ASU will be effective for fiscal years beginning after December 15, 2019,
including interim periods within those fiscal years. The adoption of ASU No. 2016-13 did not have a material impact on the consolidated
financial statements of the Company.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
In March 2018, the FASB issued ASU 2018-05, “Income
Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118,” which amends the FASB ASC and
XBRL Taxonomy based on the Tax Cuts and Jobs Act, or the Act, that was signed into law on December 22, 2017 and Staff Accounting Bulletin
No. 118 that was released by the SEC. The Act changes numerous provisions that impact U.S. corporate tax rates, business-related exclusions,
and deductions and credits and may additionally have international tax consequences for many companies that operate internationally. The
company has adopted this new guidance on our consolidated financial statements.
In January 2017, the FASB issued ASU No. 2017-01,
“Business Combinations (Topic 805): Clarifying the Definition of a Business”. The amendments in this ASU clarify the definition
of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as
acquisitions (or disposals) of assets or businesses. These amendments take effect for public businesses for fiscal years beginning after
December 15, 2017 and interim periods within those periods, and all other entities should apply these amendments for fiscal years beginning
after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019. The adoption of ASU No. 2017-01
did not have a material impact on the consolidated financial statements of the Company.
Recently Issued Accounting Standards:
In December 2019, the FASB issued ASU 2019-12,
“Simplifying the Accounting for Income Taxes.” This ASU eliminates certain exceptions related to the approach for intra period
tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for
outside basis differences. It also clarifies and simplifies other aspects of accounting for income taxes. ASU 2019-12 is effective for
interim and annual reporting periods beginning after December 15, 2020, with early adoption permitted. The Company will adopt ASU 2019-12
effective January 1, 2021.
Reclassification
Certain comparative figures have been reclassified
to conform to the current period presentation.
NOTE 3 – ACCOUNTS RECEIVABLE, NET
Accounts receivable consisted of the following
as of December 31, 2020 and June 30, 2020:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Accounts receivable, gross
|
|
$
|
1,502,961
|
|
|
$
|
1,774,792
|
|
|
Less: allowance for doubtful accounts
|
|
|
-
|
|
|
|
-
|
|
|
Accounts receivable, net
|
|
$
|
1,502,961
|
|
|
$
|
1,774,792
|
|
The Group recorded no allowance for doubtful accounts
as of December 31, 2020 and June 30, 2020. The Group gives its customers credit period of 30 days and continually assesses the recoverability
of uncollected accounts receivable. As of December 31, 2020, the balances of the Group’s accounts receivable were all due within
1 month. Management believes the balances of accounts receivable will be collected in full.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
4 – PREPAYMENT AND OTHER CURRENT ASSETS
Prepayments
and other current assets as of December 31, 2020 and June 30, 2020, consisted of the following:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Prepaid income tax expenses
|
|
$
|
-
|
|
|
$
|
18,385
|
|
|
Prepayment of advertisement fees
|
|
|
-
|
|
|
|
706,265
|
|
|
Prepaid office deposit
|
|
|
26,192
|
|
|
|
17,077
|
|
|
IPO cost
|
|
|
1,073,081
|
|
|
|
965,357
|
|
|
Other current assets
|
|
|
165,237
|
|
|
|
196,477
|
|
|
Total
|
|
$
|
1,264,510
|
|
|
$
|
1,903,561
|
|
NOTE
5 – EQUIPMENT AND VEHICLES, NET
Equipment
and vehicles consisted of the following as of December 31, 2020 and June 30, 2020:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Office Equipment
|
|
$
|
10,560
|
|
|
$
|
9,732
|
|
|
Electronic Equipment
|
|
|
70,413
|
|
|
|
64,897
|
|
|
Motor Vehicles
|
|
|
57,189
|
|
|
|
52,710
|
|
|
Total equipment and vehicles, at cost
|
|
|
138,162
|
|
|
|
127,339
|
|
|
Less: accumulated depreciation
|
|
|
(88,778
|
)
|
|
|
(74,297
|
)
|
|
Equipment and vehicles, net
|
|
$
|
49,384
|
|
|
$
|
53,042
|
|
As
of December 31, 2020 and June 30, 2020, there was no pledged equipment or vehicles.
The
Company recorded depreciation expense of $7,898 and $8,248 during the six months ended December 31, 2020 and 2019, respectively.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
6 – INTANGIBLE ASSETS, NET
Intangible
assets consisted of the following as of December 31, 2020 and June 30, 2020:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Software
|
|
$
|
18,302
|
|
|
$
|
16,868
|
|
|
Senior care service App
|
|
|
45,978
|
|
|
|
42,376
|
|
|
Less: accumulated amortization
|
|
|
(23,093
|
)
|
|
|
(16,203
|
)
|
|
Intangible assets, net
|
|
$
|
41,187
|
|
|
$
|
43,041
|
|
|
Future Amortization
|
|
Software
|
|
|
Senior care
service App
|
|
|
Total
|
|
|
December 2020 to December 2021
|
|
$
|
1,830
|
|
|
$
|
9,196
|
|
|
$
|
11,026
|
|
|
December 2021 to December 2022
|
|
|
1,830
|
|
|
|
9,196
|
|
|
|
11,026
|
|
|
December 2022 to December 2023
|
|
|
1,830
|
|
|
|
9,196
|
|
|
|
11,026
|
|
|
December 2023 to December 2024
|
|
|
1,830
|
|
|
|
5,364
|
|
|
|
7,194
|
|
|
December 2024 to December 2025
|
|
|
915
|
|
|
|
-
|
|
|
|
915
|
|
|
Total
|
|
$
|
8,235
|
|
|
$
|
32,952
|
|
|
$
|
41,187
|
|
As
of December 31, 2020 and June 30, 2020, there were no pledged intangible assets.
The
Company recorded amortization expense of $5,331 and $4,339 during the six months ended December 31, 2020 and 2019, respectively.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
7 – OPERATING LEASE RIGHT-OF-USE ASSETS, NET
Operating
lease right -of-use assets, net were as follows as of December 31, 2020 and 2019:
|
|
|
As of
June 30,
2020
|
|
|
Increase/
(Decrease)
|
|
|
Exchange
Rate
Translation
|
|
|
As of
December 31,
2020
|
|
|
Shou Hill Valley Area
|
|
$
|
2,118,794
|
|
|
$
|
-
|
|
|
$
|
180,092
|
|
|
$
|
2,298,886
|
|
|
Villas
|
|
|
2,091,284
|
|
|
|
-
|
|
|
|
380,821
|
|
|
|
2,472,105
|
|
|
Hotel
|
|
|
2,225,557
|
|
|
|
-
|
|
|
|
150,172
|
|
|
|
2,375,729
|
|
|
Base Station Tower
|
|
|
246,819
|
|
|
|
-
|
|
|
|
20,979
|
|
|
|
267,798
|
|
|
Total right-of-use assets, at cost
|
|
|
6,682,454
|
|
|
|
-
|
|
|
|
732,064
|
|
|
|
7,414,518
|
|
|
Less: accumulated amortization
|
|
|
(730,866
|
)
|
|
|
(248,824
|
)
|
|
|
(199,737
|
)
|
|
|
(1,179,427
|
)
|
|
Right-of-use assets, net
|
|
$
|
5,951,588
|
|
|
$
|
(248,824
|
)
|
|
$
|
532,327
|
|
|
$
|
6,235,091
|
|
|
|
|
As of
June 30,
2019
|
|
|
Increase/
(Decrease)
|
|
|
Exchange
Rate
Translation
|
|
|
As of
December 31,
2019
|
|
|
Shou Hill Valley Area
|
|
$
|
2,181,913
|
|
|
$
|
-
|
|
|
$
|
(31,745
|
)
|
|
$
|
2,150,168
|
|
|
Villas
|
|
|
2,153,584
|
|
|
|
-
|
|
|
|
192,625
|
|
|
|
2,346,209
|
|
|
Hotel
|
|
|
2,291,857
|
|
|
|
23,225
|
|
|
|
(33,208
|
)
|
|
|
2,281,874
|
|
|
Total right-of-use assets, at cost
|
|
|
6,627,354
|
|
|
|
23,225
|
|
|
|
127,672
|
|
|
|
6,778,251
|
|
|
Less: accumulated amortization
|
|
|
(330,614
|
)
|
|
|
(254,217
|
)
|
|
|
(186,621
|
)
|
|
|
(771,452
|
)
|
|
Right-of-use assets, net
|
|
$
|
6,296,740
|
|
|
$
|
(230,992
|
)
|
|
$
|
(58,949
|
)
|
|
$
|
6,006,799
|
|
The
Group recognizes lease expense for the Shou Hill Valley Area and Villas Operating Lease Right-of-Use Assets over a 20 year period. The
Group recognizes lease expense for the Hotel and Base Station Tower Operating Lease Right-of-Use Assets over a 10 year period. Lease
expense for the six months ended December 31, 2020 and 2019 totaled 248,824 and $254,217, respectively.
The
group subleases its operating leased right-of-use hotel and earned rental income of $96,408 and $98,576 for the six months ended December
31, 2020 and 2019, respectively.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
8 – FINANCE LEASE RIGHT-OF-USE ASSETS, NET
Finance
lease right -of-use assets, net were as follows as of December 31, 2020 and 2019:
|
|
|
As of
June 30,
2020
|
|
|
Increase/
(Decrease)
|
|
|
Exchange Rate
Translation
|
|
|
As of
December 31,
2020
|
|
|
Company vehicles
|
|
$
|
1,695,035
|
|
|
$
|
-
|
|
|
$
|
144,074
|
|
|
$
|
1,839,109
|
|
|
Total right-of-use assets, at cost
|
|
|
1,695,035
|
|
|
|
-
|
|
|
|
144,074
|
|
|
|
1,839,109
|
|
|
Less: accumulated amortization
|
|
|
(296,631
|
)
|
|
|
(88,929
|
)
|
|
|
(28,240
|
)
|
|
|
(413,800
|
)
|
|
Right-of-use assets, net
|
|
$
|
1,398,404
|
|
|
$
|
(88,929
|
)
|
|
$
|
115,834
|
|
|
$
|
1,425,309
|
|
|
|
|
As of
June 30,
2019
|
|
|
Increase/
(Decrease)
|
|
|
Exchange Rate
Translation
|
|
|
As of
December 31,
2019
|
|
|
Company vehicles
|
|
$
|
1,745,531
|
|
|
$
|
-
|
|
|
$
|
(25,397
|
)
|
|
$
|
1,720,134
|
|
|
Total right-of-use assets, at cost
|
|
|
1,745,531
|
|
|
|
-
|
|
|
|
(25,397
|
)
|
|
|
1,720,134
|
|
|
Less: accumulated amortization
|
|
|
(130,915
|
)
|
|
|
(85,502
|
)
|
|
|
1,400
|
|
|
|
(215,017
|
)
|
|
Right-of-use assets, net
|
|
$
|
1,614,616
|
|
|
$
|
(85,502
|
)
|
|
$
|
(23,997
|
)
|
|
$
|
1,505,117
|
|
The
Finance Lease Right-of-Use Asset is amortized over a 10-year period. The amortization period is 10 years and the discount rate used is
4.9%.
NOTE
9 – LONG-TERM PREPAYMENTS AND OTHER NON-CURRENT ASSETS
Long-term
prepayments and other current assets as of December 31, 2020 and June 30, 2020, consisted of the following:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
Description
|
|
2020
|
|
|
2020
|
|
|
Deposits paid for lease assets
|
|
$
|
383,148
|
|
|
$
|
353,132
|
|
|
Deposits paid for land
|
|
|
1,532,591
|
|
|
|
1,412,529
|
|
|
Performance deposits*
|
|
|
2,911,921
|
|
|
|
2,683,806
|
|
|
Total
|
|
$
|
4,827,660
|
|
|
$
|
4,449,467
|
|
|
|
*
|
E-Home
Pingtan entered into three agreements with three new outlets for their cooperation. These refundable performance deposits were paid to
the outlets in exchange for their agreement to refer business and customers to E-Home Pingtan within the next three years.
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
10 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES
The
following is a summary of accounts payable and accrued expenses as of December 31, 2020 and June 30, 2020:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Payable to suppliers
|
|
$
|
5,237,500
|
|
|
$
|
2,629,626
|
|
|
Salary and welfare payables
|
|
|
750,382
|
|
|
|
239,726
|
|
|
Accrued expenses and other current liabilities
|
|
|
116,307
|
|
|
|
103,789
|
|
|
Total
|
|
$
|
6,104,189
|
|
|
$
|
2,973,141
|
|
NOTE
11 – ADVANCES FROM CUSTOMERS
E-Home
received annual fees from senior care services customers and recognized revenues over the contract period. The amounts advanced from
customers were $2,809,264 and $1,412,390 as of December 31, 2020 and June 30, 2020, respectively, which will be recognized as senior
care services revenue within 12 months.
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Advances from customers:
|
|
|
|
|
|
|
|
|
|
Senior care services
|
|
$
|
2,809,264
|
|
|
$
|
1,412,390
|
|
|
Advances from other services
|
|
|
157,688
|
|
|
|
1,955
|
|
|
Total
|
|
$
|
2,966,952
|
|
|
$
|
1,414,345
|
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
12 – OPERATING LEASE LIABILITIES
Operating
lease liabilities as of December 31, 2020 and June 30, 2020, consisted of the following:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Villas*
|
|
$
|
1,893,827
|
|
|
$
|
1,710,553
|
|
|
Hotel**
|
|
|
1,312,194
|
|
|
|
1,383,040
|
|
|
Base Station Tower***
|
|
|
245,136
|
|
|
|
222,542
|
|
|
Total
|
|
$
|
3,451,157
|
|
|
$
|
3,316,135
|
|
The
operating lease liabilities are the net present value of the remaining lease payments at December 31, 2020 and June 30, 2020. The discount
rates used for the Villas and hotels are 4.1239% and 3.2265%, respectively. The weighted average discount rate used for operating leases
is 3.823%.
|
|
*
|
The
lease agreement was entered into on December 22, 2017, bears interest at about 4.1239% and will be matured on December 31, 2037. As of
December 31, 2020, the Company has paid $689,666 for the first installment.
|
|
|
**
|
The
lease agreement of hotel was entered on December 19, 2018, bears interest at about 3.2265% and will mature on September 30, 2028. As
of December 31, 2020, the Company has paid $550,353 for the first 2.5 years’ installment and $495,740 for the lease transfer income
to the original lessee.
|
|
|
***
|
The
lease agreement was entered into on November 25, 2019, bears interest at about 3.1365% and will be matured on November 24, 2029. As of
December 31, 2020, the Company has paid $30,652 for the first installment.
|
NOTE
13 – FINANCE LEASE LIABILITIES
Financing
lease liabilities as of December 31, 2020 and 2019, consisted of the following:
|
|
|
As of
June 30,
2020
|
|
|
Increase/
(Decrease)
|
|
|
Payment
|
|
|
Exchange Rate
Translation
|
|
|
As of
December 31,
2020
|
|
|
Company vehicles
|
|
$
|
461,728
|
|
|
$
|
|
|
|
|
(39,433
|
)
|
|
$
|
40,036
|
|
|
$
|
462,331
|
|
|
Add: Unrecognized finance expense
|
|
|
47,492
|
|
|
|
12,820
|
|
|
|
|
|
|
|
2,341
|
|
|
|
62,653
|
|
|
Total financing lease liabilities
|
|
$
|
509,220
|
|
|
$
|
12,820
|
|
|
|
(39,433
|
)
|
|
$
|
42,377
|
|
|
$
|
524,984
|
|
|
|
|
As of
June 30,
2019
|
|
|
Increase/
(Decrease)
|
|
|
Payment
|
|
|
Exchange Rate
Translation
|
|
|
As of
December 31,
2019
|
|
|
Company vehicles
|
|
$
|
552,885
|
|
|
$
|
|
|
|
$
|
(37,914
|
)
|
|
$
|
(8,268
|
)
|
|
$
|
506,703
|
|
|
Add: Unrecognized finance expense
|
|
|
21,865
|
|
|
|
13,548
|
|
|
|
|
|
|
|
(239
|
)
|
|
|
35,174
|
|
|
Total financing lease liabilities
|
|
$
|
574,750
|
|
|
$
|
13,548
|
|
|
$
|
(37,914
|
)
|
|
$
|
(8,507
|
)
|
|
$
|
541,877
|
|
Analyzed
for reporting purposes as:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Long-term portion of finance lease liabilities
|
|
$
|
467,887
|
|
|
$
|
457,867
|
|
|
Current maturities of finance lease liabilities
|
|
|
57,097
|
|
|
|
51,353
|
|
|
Total
|
|
$
|
524,984
|
|
|
$
|
509,220
|
|
The
lease agreement was entered into on September 11, 2017, bears interest at about 4.9% and will be matured on December 31, 2027.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
14 – TAXES
The
Company is registered in the Cayman Islands. The Company generated substantially all of its income from its PRC operations for the six
months ended December 31, 2020 and 2019.
Cayman
Islands
Under
the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends
to the shareholders, no Cayman Islands withholding tax will be imposed.
Hong
Kong
E-Home
Hong Kong is not subject to tax on income or capital gain since there has no operations in Hong Kong for the six months ended December
31, 2020 and 2019.
PRC
Income
Tax
On
March 16, 2007, the National People’s Congress of PRC enacted an Enterprise Income Tax Law (“EIT Law”), under which
Foreign Investment Enterprises and domestic companies would be subject to enterprise income tax (“EIT”) at a uniform rate
of 25%. The EIT Law became effective on January 1, 2008. 25% tax rates apply to all the PRC operation subsidiaries in the Group.
The
provision for income tax for the six months ended December 31, 2020 and 2019, consisted of the following:
|
|
|
For six months ended
December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Current income tax provision
|
|
$
|
3,319,398
|
|
|
$
|
2,242,784
|
|
|
Deferred income tax provision
|
|
|
(349,219
|
)
|
|
|
-
|
|
|
Total
|
|
$
|
2,970,179
|
|
|
$
|
2,242,784
|
|
The
following table sets forth reconciliation between the statutory EIT rate and the effective tax for the six months ended December 31,
2020 and 2019, respectively:
|
|
|
For six months ended
December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Provision for income taxes at statutory tax rate in the PRC
|
|
$
|
2,968,760
|
|
|
$
|
2,235,051
|
|
|
Effect of income for which no income tax is chargeable
|
|
|
-
|
|
|
|
-
|
|
|
Effect of expense for which no income tax is deductible
|
|
|
1,419
|
|
|
|
7,733
|
|
|
Reversal of deficit
|
|
|
-
|
|
|
|
-
|
|
|
Effective income tax expense
|
|
$
|
2,970,179
|
|
|
$
|
2,242,784
|
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The
significant components of deferred tax assets were as follows:
|
|
|
As
of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Deferred tax assets
|
|
|
|
|
|
|
|
Senior care services fees advanced from customers
|
|
$
|
702,316
|
|
|
$
|
353,097
|
|
|
Total
|
|
$
|
702,316
|
|
|
$
|
353,097
|
|
Value
Added Tax (“VAT”)
Business
tax changed to VAT in China since May 1, 2016. The Group’s revenue of installation is subject to a VAT rate of 11%.
The
maintenance and accessories sales were subject to a VAT rate of 17% before May 1, 2018 and were reduced to 16% since then.
According
to the regulations (Fiscal and Tax [2016] 36), no VAT will be levied if an enterprise provides employee-based household services. E-Home
Pingtan applied for the tax exemption in July 2017 and was approved by the State Administration of Taxation (China), so the VAT rate
of installation, maintenance, after-sales and cleaning service is nil since July 2017.
Taxes
payable
The
Group’s taxes payable as of December 31, 2020 and June 30, 2020, consisted of the following:
|
|
|
As of
December 31,
|
|
|
As of
June 30,
|
|
|
|
|
2020
|
|
|
2020
|
|
|
Income tax payable
|
|
$
|
1,790,359
|
|
|
$
|
-
|
|
|
VAT payable
|
|
|
13,586
|
|
|
|
5,797
|
|
|
Other tax payables (other payables and accrued liabilities)
|
|
|
4,460
|
|
|
|
2,228
|
|
|
Total
|
|
$
|
1,808,405
|
|
|
$
|
8,025
|
|
NOTE
15 - EQUITY
Ordinary
Shares
At
the reorganization event described in Note 1, the Company issued 50,000 ordinary shares with par value of $1 to exchange for the ownership
in E-Home Pingtan from the former shareholders to WFOE.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Prior
to the reorganization, the Company had $3,620,757 in contributed ownership as of December 31, 2020 and June 30, 2020.
The
reorganization has been accounted for at historical cost and prepared on the basis as if the reorganization had become effective as of
the beginning of the first period presented in the accompanying financial statements of the Company.
On
May 23, 2019, the Company subdivided its 50,000 ordinary shares into 500,000,000 ordinary shares. The authorized ordinary shares became
500,000,000 shares and the par value changed from US$1 to US$0.0001. On the same day, the Company cancelled 472,000,000 ordinary shares.
Currently, the Company has 28,000,000 ordinary shares issued and outstanding.
Statutory
Reserve
The
Company is required to make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus
reserve, based on after-tax net income determined in accordance with generally accepted accounting principles of the PRC (“PRC
GAAP”). Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined
in accordance with PRC GAAP until the reserve is equal to 50% of the entity’s registered capital. Appropriations to the discretionary
surplus reserve are made at the discretion of the Board of Directors. The reserved amounts as determined pursuant to PRC statutory laws
totaled $664,100 as of December 31, 2020 and June 30, 2020.
Dividends
Dividends
declared by the Company are based on the distributable profits as reported in its statutory financial statements reported in accordance
with PRC GAAP, which may differ from the results of operations reflected in the consolidated financial statements prepared in accordance
with US GAAP. The Company’s ability to pay dividends is primarily from cash received from its operating activities in PRC.
NOTE
16 – REVENUE
The
Company disaggregated senior care services revenue into the sale of the E-watch and the care service. Sales of E-watches are recognized
in revenue at a point in time while revenue from care service is recognized over a period of time. Deferred portion of care service is
recorded as a liability (advances from customers) on the company’s balance sheet.
|
|
|
For six months ended December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Installation and Maintenance
|
|
$
|
32,055,964
|
|
|
$
|
22,210,424
|
|
|
Housekeeping
|
|
|
9,630,598
|
|
|
|
7,597,993
|
|
|
Senior care services
|
|
|
1,828,317
|
|
|
|
1,657,352
|
|
|
E-watch
|
|
|
576,174
|
|
|
|
-
|
|
|
Total
|
|
$
|
44,091,053
|
|
|
$
|
31,465,769
|
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
17 – SEGMENT INFORMATION
Operating
segments are reported in a manner consistent with the internal reporting provided to the management for decision making. Management has
identified three operating segments which are installation and maintenance, housekeeping and senior care services. The Group has started
generating revenue from senior care in August 2019. These operating segments are monitored and strategic decisions are made on the basis
of segmental profit margins. Segment profit is defined as net sales reduced by cost of revenue and other related operating expenses.
The results are shown as follows for the six months ended December 31, 2020 and 2019:
|
|
|
For the six months ended December 31,
|
|
|
Revenue
|
|
2020
|
|
|
2019
|
|
|
Installation and maintenance
|
|
$
|
32,055,964
|
|
|
$
|
22,210,424
|
|
|
Housekeeping
|
|
|
9,630,598
|
|
|
|
7,597,993
|
|
|
Senior care services
|
|
|
2,404,491
|
|
|
|
1,657,352
|
|
|
Total
|
|
$
|
44,091,053
|
|
|
$
|
31,465,769
|
|
|
Gross Profit
|
|
2020
|
|
|
2019
|
|
|
Installation and maintenance
|
|
$
|
12,218,084
|
|
|
$
|
9,036,866
|
|
|
Housekeeping
|
|
|
2,272,276
|
|
|
|
1,722,399
|
|
|
Senior care services
|
|
|
1,294,480
|
|
|
|
765,431
|
|
|
Total
|
|
$
|
15,784,840
|
|
|
$
|
11,524,716
|
|
|
Current Assets
|
|
December 31,
2020
|
|
|
June 30,
2020
|
|
|
Installation and maintenance
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Housekeeping
|
|
|
-
|
|
|
|
-
|
|
|
Senior care services
|
|
|
-
|
|
|
|
-
|
|
|
Unallocated current assets
|
|
|
46,288,545
|
|
|
|
28,700,552
|
|
|
Total
|
|
$
|
46,288,545
|
|
|
$
|
28,700,552
|
|
|
Non-current Assets
|
|
December 31,
2020
|
|
|
June 30,
2020
|
|
|
Installation and maintenance
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Housekeeping
|
|
|
-
|
|
|
|
-
|
|
|
Senior care services
|
|
|
6,736,012
|
|
|
|
6,304,720
|
|
|
Unallocated non-current assets
|
|
|
6,544,935
|
|
|
|
5,943,919
|
|
|
Total
|
|
$
|
13,280,947
|
|
|
$
|
12,248,639
|
|
On
account of the Group’s business model, assets, operating expense, liabilities and other material items could not be separated into
each operating segment. As the Group’s long-lived assets and revenue are substantially located in and derived from the PRC, no
geographical segments are presented.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE
18 – COMMITMENTS AND CONTINGENCIES
As
of December 31, 2020, the Group had following lease commitments under non-cancelable agreements:
|
Future Lease Payments
|
|
Operating Lease
|
|
|
Finance Lease
|
|
|
Total
|
|
|
December 2020 to December 2021
|
|
$
|
273,721
|
|
|
$
|
81,551
|
|
|
$
|
355,272
|
|
|
December 2021 to December 2022
|
|
|
1,001,701
|
|
|
|
81,551
|
|
|
|
1,083,252
|
|
|
December 2022 to December 2023
|
|
|
243,069
|
|
|
|
81,551
|
|
|
|
324,620
|
|
|
December 2023 to December 2024
|
|
|
243,069
|
|
|
|
81,551
|
|
|
|
324,620
|
|
|
December 2024 to December 2025
|
|
|
243,069
|
|
|
|
81,551
|
|
|
|
324,620
|
|
|
Thereafter
|
|
|
2,269,230
|
|
|
|
224,264
|
|
|
|
2,493,494
|
|
|
Total
|
|
$
|
4,273,859
|
|
|
$
|
632,019
|
|
|
$
|
4,905,878
|
|
NOTE
19 – CUSTOMER AND SUPPLIER CONCENTRATION
Significant
customers and suppliers are those that account for greater than 10% of the Company’s revenues and purchase.
The
Company’s sales are made to customers that are located primarily in China. For the periods ended December 31, 2020 and 2019, no
individual customer or supplier accounted for more than 10% of the Company’s total revenues or purchase. As of December 31, 2020
and June 30, 2020, no individual customer or supplier accounted for more than 10% of the total outstanding accounts receivable or accounts
payable balance.
NOTE
20 – RELATED PARTY BALANCES AND TRANSACTIONS
The
Group had $2,299 payable to a shareholder as of December 31, 2020.
NOTE
21 – SUBSEQUENT EVENTS
In
accordance with ASC 855-10, the Company has analyzed its operations subsequent to December 31, 2020 to the date these financial statements
were issued, and has determined that, it does not have any material subsequent events to disclose in these financial statements.
NOTE
22 – CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY
The
Company performed a test on the restricted net assets of consolidated subsidiary in accordance with Securities and Exchange Commission
Regulation S-X Rule 4-08 (e) (3), “General Notes to Financial Statements” and concluded that it was applicable for the Company
to disclose the financial statements for the parent company.
The
subsidiary did not pay any dividend to the Company for the periods presented. For the purpose of presenting parent only financial information,
the Company records its investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate
condensed balance sheets of the Company as “Investment in subsidiary” and the income of the subsidiary is presented as “share
of income of subsidiary”. Certain information and footnote disclosures generally included in financial statements prepared in accordance
with U.S. GAAP have been condensed and omitted.
The
Company did not have significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2020 and June
30, 2020.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
BALANCE
SHEETS
|
|
|
As of
December 31,
|
|
|
As of
June 30
|
|
|
|
|
2020
|
|
|
2020
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Investment in subsidiary
|
|
|
44,749,561
|
|
|
|
32,762,819
|
|
|
Total assets
|
|
$
|
44,749,561
|
|
|
$
|
32,762,819
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
Total liabilities
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, 28,000,000 shares issued and outstanding, respectively
|
|
|
2,800
|
|
|
|
2,800
|
|
|
Additional paid-in capital
|
|
|
3,667,957
|
|
|
|
3,667,957
|
|
|
Statutory reserve
|
|
|
664,100
|
|
|
|
664,100
|
|
|
Retained earnings
|
|
|
39,301,474
|
|
|
|
30,395,350
|
|
|
Accumulated other comprehensive income(loss)
|
|
|
1,113,230
|
|
|
|
(1,967,388
|
)
|
|
Total stockholders’ equity
|
|
|
44,749,561
|
|
|
|
32,762,819
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
44,749,561
|
|
|
$
|
32,762,819
|
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
STATEMENTS
OF INCOME AND COMPREHENSIVE INCOME
|
|
|
For the six months ended December 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
Share of income of subsidiaries and VIEs
|
|
|
8,906,124
|
|
|
|
6,704,601
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,906,124
|
|
|
$
|
6,704,601
|
|
|
Other comprehensive income (loss):
|
|
|
-
|
|
|
|
-
|
|
|
Foreign currency translation adjustment, net of nil tax
|
|
$
|
3,080,618
|
|
|
$
|
(355,563
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income
|
|
$
|
11,986,742
|
|
|
$
|
6,349,038
|
|
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(a)
Basis of Presentation
Condensed
financial information is used for the presentation of the Company, or the parent company. The condensed financial information of the
parent company has been prepared using the same accounting policies as set out in the Company’s consolidated financial statements
except that the parent company used the equity method to account for investment in its subsidiaries and VIEs.
The
parent company records its investment in its subsidiaries and VIEs under the equity method of accounting as prescribed in ASC 323, Investments-Equity
Method and Joint Ventures. Such investments are presented on the condensed balance sheets as “Investment in subsidiaries and VIEs”
and their respective profit or loss as “Share of profit in subsidiaries and VIEs” on the condensed statements of income.
Equity method accounting ceases when the carrying amount of the investment, including any additional financial support, in a subsidiary
and VIE is reduced to zero unless the parent company has guaranteed obligations of the subsidiary and VIE or is otherwise committed to
provide further financial support. If the subsidiary and VIE subsequently report net income, the parent company shall resume applying
the equity method only after its share of that net income equals the share of net losses not recognized during the period the equity
method was suspended.
The
parent company’s condensed financial statements should be read in conjunction with the Company’s consolidated financial statements.
(b)
Shareholders’ Equity
On
September 24, 2018, the Company issued 50,000 ordinary shares with par value of $1 to its shareholders.
On
May 23, 2019, the Company subdivided its 50,000 ordinary shares into 500,000,000 ordinary shares. The authorized ordinary shares became
500,000,000 shares and the par value changed from US$1 to US$0.0001. On the same day, the Company cancelled 472,000,000 ordinary shares.
As a result, the Company has 28,000,000 ordinary shares issued and outstanding. Accordingly, all share and per share information has
been restated to retroactively show the effect of this recapitalization.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
SEC allows us to “incorporate by reference” the information we file with it into this prospectus. This means that we can
disclose important information about us and our financial condition to you by referring you to another document filed separately with
the SEC instead of having to repeat the information in this prospectus. The information incorporated by reference is considered to be
part of this prospectus and later information that we file with the SEC will automatically update and supersede this information. We
incorporate by reference into this prospectus the information contained in the documents listed below and any future filings made by
us with the SEC under Section 13(a), 13(c) or 15(d) of the Exchange Act, except for information “furnished” to the SEC which
is not deemed filed and not incorporated by reference into this prospectus (unless otherwise indicated below), until the termination
of the offering of securities described in the applicable prospectus supplement:
|
|
●
|
the Company’s Annual
Report on Form 20-F for the fiscal year ended June 30, 2020, filed with the SEC on November 16, 2020;
|
|
|
●
|
the Company’s Report
of Foreign Private Issuer on Form 6-K furnished with the SEC on November 30, 2020;
|
|
|
●
|
first paragraph in Exhibit 99.1 to the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on May 14, 2021;
|
|
|
●
|
first paragraph in Exhibit 99.1 to the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on May 19, 2021;
|
|
|
●
|
first paragraph in Exhibit 99.1 to the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on June 23, 2021;
|
|
|
●
|
first paragraph in Exhibit 99.1 to the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on July 15, 2021;
|
|
|
●
|
first two paragraphs in
Exhibit 99.1 to the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on August 10, 2021;
|
|
|
●
|
the Company’s Report of Foreign Private Issuer on Form 6-K furnished with the SEC on August 23, 2021;
|
|
|
●
|
The description of the
Company’s Ordinary Shares contained in our registration statement on Form 8-A12B filed on April 30, 2021 pursuant to
Section 12(b) of the Exchange Act, including any amendment or reports filed hereafter for the purpose of updating such description;
and
|
We
also incorporate by reference any future annual reports on Form 20-F we file with the SEC under the Exchange Act after the date of this
prospectus and prior to the termination of the offering of securities by means of this prospectus, and any future reports of foreign
private issuer on Form 6-K we furnish with the SEC during such period that are identified in such reports as being incorporated by reference
in this prospectus.
Any
reports filed by us with the SEC after the date of this prospectus and before the date that the offering of securities by means of this
prospectus is terminated will automatically update and, where applicable, supersede any information contained in this prospectus or incorporated
by reference in this prospectus. This means that you must look at all of the SEC filings that we incorporate by reference to determine
if any of the statements in this prospectus or in any documents incorporated by reference have been modified or superseded. Unless expressly
incorporated by reference, nothing in this prospectus shall be deemed to incorporate by reference information furnished to, but not filed
with, the SEC.
We
will provide without charge to any person (including any beneficial owner) to whom this prospectus is delivered, upon oral or written
request, a copy of any document incorporated by reference in this prospectus but not delivered with the prospectus (except for exhibits
to those documents unless a document states that one of its exhibits is incorporated into the document itself). Such request should be
directed to: E-Home Household Service Holdings Limited, Floor 9, Building 14, HaixiBaiyue Town, No. 14 Duyuan Road, Luozhou Town, Cangshan
District, Fuzhou City, People’s Republic of China 350001, and telephone number +86-591-87590668.
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus is part of a registration statement on Form F-3 that we filed with the SEC registering the securities that may be offered
and sold hereunder. This prospectus, which constitutes a part of the registration statement, does not contain all of the information
set forth in the registration statement, the exhibits filed therewith or the documents incorporated by reference therein. For further
information about us and the securities offered hereby, reference is made to the registration statement, the exhibits filed therewith
and the documents incorporated by reference therein. Statements contained in this prospectus regarding the contents of any contract or
any other document that is filed as an exhibit to the registration statement are not necessarily complete, and in each instance, we refer
you to the copy of such contract or other document filed as an exhibit to the registration statement. We are required to file reports
and other information with the SEC pursuant to the Exchange Act, including annual reports on Form 20-F and reports of foreign private
issuer on Form 6-K.
The
SEC maintains a website that contains reports and other information regarding issuers, like us, that file electronically with the SEC.
The address of the website is www.sec.gov. The information on our website (www.ej111.com), other than our SEC filings, is not, and should
not be, considered part of this prospectus and is not incorporated by reference into this document.
As
a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content
of proxy statements, and our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery
provisions contained in Section 16 of the Exchange Act. In addition, we are not required under the Exchange Act to file periodic reports
and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange
Act.
E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
$300,000,000
Ordinary
Shares
Debt
Securities
Warrants
Units
PROSPECTUS
_______,
2021
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 8. Indemnification of Directors and Officers.
Cayman Islands law does not limit the extent to
which a company’s articles of association may provide for indemnification of officers and directors, except to the extent any such
provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud
or the consequences of committing a crime. Our amended and restated memorandum and articles of association permit indemnification of officers
and directors for losses, damages, costs and expenses incurred in their capacities as such unless such losses or damages arise from dishonesty
or fraud which may attach to such directors or officers. This standard of conduct is generally the same as permitted under Delaware corporate
law for a Delaware corporation. In addition, we entered into indemnification agreements with our directors and senior executive officers
that will provide such persons with additional indemnification beyond that provided in our amended and restated memorandum and articles
of association.
Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have
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.
At present, there is no pending litigation or
proceeding involving any of our directors or officers where indemnification will be required or permitted. We are not aware of any threatened
litigation or proceeding that might result in a claim for such indemnification.
Item 9. Exhibits.
The following exhibits are filed herewith or incorporated herein by
reference:
|
|
**
|
To be filed separately pursuant
to Section 305(b)(2) of the Trust Indenture Act of 1939, if applicable.
|
|
|
+
|
To be filed as an exhibit to a post-effective
amendment to this registration statement or as an exhibit to a report of the registrant filed pursuant to the Securities Exchange
Act of 1934, if applicable, and incorporated herein by reference.
|
Item 10. Undertakings.
The undersigned registrant hereby undertakes:
|
|
(1)
|
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
|
|
|
(i)
|
to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
|
|
|
(ii)
|
to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
|
|
|
(iii)
|
to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement,
|
provided, however, that subsections
(i), (ii) and (iii) above do not apply if the information required to be included in a post-effective amendment by those subsections is
contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to
Rule 424(b) that is part of the registration statement.
|
|
(2)
|
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
|
(3)
|
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
|
|
|
(4)
|
To file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act (15 U.S.C. 77j(a)(3)) need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act or Item 8.A of Form 20-F if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Form F-3.
|
|
|
(5)
|
That, for the purpose of determining liability under the Securities Act of 1933, as amended, to any purchaser:
|
|
|
(i)
|
Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of this registration statement as of the date the filed prospectus was deemed part of and included in this registration statement; and
|
|
|
(ii)
|
Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of this registration statement in reliance on Rule 430B relating to an offer made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933, as amended, shall be deemed to be part of and included in this registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
|
|
|
(6)
|
That, for the purpose of determining liability of the registrant under the Securities Act of 1933, as amended, to any purchaser in the initial distribution of the securities:
|
The undersigned registrant undertakes
that in an offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following
communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to
such purchaser:
|
|
(i)
|
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
|
|
|
(ii)
|
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
|
|
|
(iii)
|
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
|
|
|
(iv)
|
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
|
|
|
(b)
|
That, for purposes of determining any liability under the Securities Act of 1933, as amended, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934, as amended), that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
|
(c)
|
Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended, may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933, as amended, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
|
|
|
(d)
|
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
|
|
|
(e)
|
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
|
(f)
|
To file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Securities and Exchange Commission under Section 305(b)(2) of the Trust Indenture Act.
|
SIGNATURES
Pursuant to the requirements of the Securities
Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form
F-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city
of Fuzhou, China, on September 10, 2021.
|
|
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
|
|
|
|
|
|
By:
|
/s/ Wenshan Xie
|
|
|
|
Wenshan Xie
|
|
|
|
Chief Executive Officer
|
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each
person whose signature appears below constitutes and appoints Wenshan Xie, his or her true and lawful attorneys-in-fact and agents, with
full powers of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to
sign any or all amendments (including post-effective amendments) to this registration statement, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the SEC, granting unto said attorneys-in-fact and agents full power and authority
to do and perform each and every act and thing requisite and necessary to be done, as fully for all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitutes, may lawfully
do or cause to be done by virtue hereof.
*****
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed below by the following persons in the capacities and on the dates indicated.
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
/s/ Wenshan Xie
|
|
Chairman and Chief Executive Officer
|
|
September 10, 2021
|
|
Wenshan Xie
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
/s/ Chunsheng Zhu
|
|
Chief Financial Officer and Director
|
|
September 10, 2021
|
|
Chunsheng Zhu
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
|
|
|
|
/s/ Mingxiang He
|
|
Chief Marketing Officer and Director
|
|
September 10, 2021
|
|
Mingxiang He
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Yijing Ye
|
|
Director
|
|
September 10, 2021
|
|
Yijing Ye
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Ratansha B. Vakil
|
|
Director
|
|
September 10, 2021
|
|
Ratansha B. Vakil
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Jianhua Wang
|
|
Director
|
|
September 10, 2021
|
|
Jianhua Wang
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Mark W. Willis
|
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Director
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September 10, 2021
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Mark W. Willis
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SIGNATURE OF AUTHORIZED UNITED STATES
REPRESENTATIVE
Pursuant to the Securities Act, the undersigned,
the duly authorized representative in the United States of E-Home Household Service Holdings Limited, has signed this registration statement
or amendment thereto in New York, New York, U.S.A. on September 10, 2021.
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Authorized U.S. Representative
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Cogency Global Inc.
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By:
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/s/ Colleen A. De Vries
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Name:
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Colleen A. De Vries
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Title:
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Senior Vice President on behalf of Cogency Global Inc.
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II-6
Exhibit 3.1
THE COMPANIES ACT (REVISED)
EXEMPTED COMPANY LIMITED BY SHARES
THE AMENDED AND RESTATED
MEMORANDUM OF ASSOCIATION
OF
E-Home Household Service Holdings Limited
(Conditionally adopted by way of a special resolution
passed on 13 May 2021
and to become effective immediately prior to the
completion of the Company’s
initial public offering of ordinary shares)
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1.
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The name of the Company is E-Home Household
Service Holdings Limited.
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2.
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The registered office of the Company is at Harneys Fiduciary (Cayman) Limited, 4th Floor, Harbour
Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands.
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3.
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Subject to the following provisions of this Memorandum, the objects for which the Company is established
are unrestricted.
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4.
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Subject to the following provisions of this Memorandum, the Company shall have and be capable of exercising
all the functions of a natural person of full capacity irrespective of any question of corporate benefit, as provided by Section 27(2)
of the Companies Act.
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5.
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Nothing in this Memorandum shall permit the Company to carry on a business for which a licence is required
under the laws of the Cayman Islands unless duly licensed.
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6.
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The Company shall not trade in the Cayman Islands with any person, firm or corporation except in furtherance
of the business of the Company carried on outside the Cayman Islands; provided that nothing in this clause shall be construed as to prevent
the Company effecting and concluding contracts in the Cayman Islands, and exercising in the Cayman Islands all of its powers necessary
for the carrying on of its business outside the Cayman Islands.
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7.
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The liability of each member is limited to the amount from time to time unpaid on such member’s shares.
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8.
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The share capital of the Company is US$50,000 divided into 500,000,000 ordinary shares of a nominal or
par value of US$0.0001 each.
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9.
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The Company may exercise the power contained in the Companies Act to deregister in the Cayman Islands
and be registered by way of continuation in another jurisdiction.
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The Companies Act (Revised)
Company Limited by Shares
THE AMENDED AND RESTATED
ARTICLES OF ASSOCIATION
OF
E-Home Household Service Holdings Limited
(Conditionally adopted by way of a special resolution
passed on 13 May 2021
and to become effective immediately prior to the
completion of the Company’s
initial public offering of Ordinary Shares)
INDEX
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SUBJECT
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Article No.
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Table A
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1
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Interpretation
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2
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Share Capital
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3
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Alteration Of Capital
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4-7
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Share Rights
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8-9
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Variation Of Rights
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10-11
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Shares
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12-15
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Share Certificates
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16-21
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Lien
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22-24
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Calls On Shares
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25-33
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Forfeiture Of Shares
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34-42
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Register Of Members
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43-44
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Record Dates
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45
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Transfer Of Shares
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46-51
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Transmission Of Shares
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52-54
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Untraceable Members
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55
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General Meetings
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56-58
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Notice Of General Meetings
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59-60
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Proceedings At General Meetings
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61-65
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Voting
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66-77
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Proxies
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78-83
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Corporations Acting By Representatives
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84
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Action By Written Resolutions Of Members
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85
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Board Of Directors
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86
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Retirement of Directors
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87-88
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Disqualification Of Directors
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89
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Executive Directors
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90-91
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Alternate Directors
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92-95
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Directors’ Fees And Expenses
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96-99
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Directors’ Interests
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100-103
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General Powers Of The Directors
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104-109
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Borrowing Powers
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110-113
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Proceedings Of The Directors
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114-123
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Audit Committee
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124-126
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Officers
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127-130
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Register of Directors and Officers
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131
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Minutes
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132
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Seal
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133
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Authentication Of Documents
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134
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Destruction Of Documents
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135
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Dividends And Other Payments
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136-145
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Reserves
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146
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Capitalisation
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147-148
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Subscription Rights Reserve
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149
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Accounting Records
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150-154
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Audit
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155-160
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Notices
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161-163
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Signatures
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164
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Winding Up
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165-166
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Indemnity
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167
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Amendment To Memorandum and Articles of Association And Name of Company
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168
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Information
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169
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INTERPRETATION
TABLE A
1. The regulations in Table A in the
Schedule to the Companies Act (Revised) do not apply to the Company.
INTERPRETATION
2. (1) In these Articles, unless the
context otherwise requires, the words standing in the first column of the following table shall bear the meaning set opposite them
respectively in the second column.
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WORD
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MEANING
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“Act”
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The Companies Act (2021 Revision) as consolidated and revised of the Cayman Islands.
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“Articles”
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these Articles in their present form or as supplemented or amended or substituted from time to time.
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“Audit Committee”
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the audit committee of the Company formed by the Board pursuant to Article 122 hereof, or any successor audit committee.
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“Auditor”
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the independent auditor of the Company which shall be an internationally recognized firm of independent accountants.
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“Board” or “Directors”
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the board of directors of the Company or the directors present at a meeting of directors of the Company at which a quorum is present.
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“capital”
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the share capital from time to time of the Company.
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“clear days”
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in relation to the period of a notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect.
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“clearing house”
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a clearing house recognised by the laws of the jurisdiction in which the shares of the Company (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such jurisdiction.
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“Company”
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E-Home Household Service Holdings Limited.
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“competent regulatory authority”
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a competent regulatory authority in the territory where the shares of the Company (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such territory.
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“debenture” and “debenture holder”
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include debenture stock and debenture stockholder respectively.
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“Designated Stock Exchange”
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the stock exchange in the United States of America on which any shares of the Company are listed for trading
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“Designated Stock Exchange Rules”
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the relevant code, rules and regulations, as amended, from time to time, applicable as a result of the original and continued listing of any shares of the Company on the Designated Stock Exchange.
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“dollars” and “$”
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dollars, the legal currency of the United States of America.
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“Exchange Act”
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the Securities Exchange Act of 1934, as amended.
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“head office”
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such office of the Company as the Directors may from time to time determine to be the principal office of the Company.
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“Member”
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a duly registered holder from time to time of the shares in the capital of the Company.
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“month”
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a calendar month.
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“Notice”
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written notice unless otherwise specifically stated and as further defined in these Articles.
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“Office”
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the registered office of the Company for the time being.
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“ordinary resolution”
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a resolution shall be an ordinary resolution when it has been (a) passed by a simple majority of votes cast by such Members as, being entitled so to do, vote in person or, in the case of any Member being a corporation, by its duly authorised representative or, where proxies are allowed, by proxy at a general meeting of which not less than ten (10) clear days’ Notice has been duly given; or (b) approved in writing by all of the Members entitled to vote at a general meeting of the Company in one or more instruments each signed by one or more of the Members and the effective date of the resolution so adopted shall be the date on which the instrument, or the last of such instruments if more than one, is executed;
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“paid up”
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paid up or credited as paid up.
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“Register”
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the principal register and where applicable, any branch register of Members of the Company to be maintained at such place within or outside the Cayman Islands as the Board shall determine from time to time.
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“Registration Office”
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in respect of any class of share capital such place as the Board may from time to time determine to keep a branch register of Members in respect of that class of share capital and where (except in cases where the Board otherwise directs) the transfers or other documents of title for such class of share capital are to be lodged for registration and are to be registered.
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“SEC”
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the United States Securities and Exchange Commission.
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“Seal”
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common seal or any one or more duplicate seals of the Company (including a securities seal) for use in the Cayman Islands or in any place outside the Cayman Islands.
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“Secretary”
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any person, firm or corporation appointed by the Board to perform any of the duties of secretary of the Company and includes any assistant, deputy, temporary or acting secretary.
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“special resolution”
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a resolution shall be a special resolution when it has been passed by a majority of not less than two-thirds of votes cast by such Members as, being entitled so to do, vote in person or, in the case of such Members as are corporations, by their respective duly authorised representative or, where proxies are allowed, by proxy at a general meeting of which not less than ten (10) clear days’ Notice, specifying (without prejudice to the power contained in these Articles to amend the same) the intention to propose the resolution as a special resolution, has been duly given. Provided that, except in the case of an annual general meeting, if it is so agreed by a majority in number of the Members having the right to attend and vote at any such meeting, being a majority together holding not less than ninety-five (95) per cent. in nominal value of the shares giving that right and in the case of an annual general meeting, if it is so agreed by all Members entitled to attend and vote thereat, a resolution may be proposed and passed as a special resolution at a meeting of which less than ten (10) clear days’ Notice has been given;
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a special resolution shall be effective for any purpose for which an ordinary resolution is expressed to be required under any provision of these Articles or the Statutes.
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“Statutes”
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the Act and every other law of the Legislature of the Cayman Islands for the time being in force applying to or affecting the Company, its Memorandum of Association and/or these Articles.
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“year”
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a calendar year.
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(2) In
these Articles, unless there be something within the subject or context inconsistent with such construction:
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(a)
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words importing the singular include the plural and vice versa;
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(b)
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words importing a gender include both gender and the neuter;
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(c)
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words importing persons include companies, associations and bodies of persons whether corporate or not;
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(i)
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“may” shall be construed as permissive;
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(ii)
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“shall” or “will” shall be construed as imperative;
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(e)
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expressions referring to writing shall, unless the contrary intention appears, be construed as including
printing, lithography, photography and other modes of representing words or figures in a visible form, and including where the representation
takes the form of electronic display, provided that both the mode of service of the relevant document or notice and the Member’s
election comply with all applicable Statutes, rules and regulations;
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(f)
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references to any law, ordinance, statute or statutory provision shall be interpreted as relating to any
statutory modification or re-enactment thereof for the time being in force;
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(g)
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save as aforesaid words and expressions defined in the Statutes shall bear the same meanings in these
Articles if not inconsistent with the subject in the context;
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(h)
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references to a document being executed include references to it being executed under hand or under seal
or by electronic signature or by any other method and references to a notice or document include a notice or document recorded or stored
in any digital, electronic, electrical, magnetic or other retrievable form or medium and information in visible form whether having physical
substance or not;
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(i)
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Section 8 of the Electronic Transactions Act (2003) of the Cayman Islands, as amended from time to time,
shall not apply to these Articles to the extent it imposes obligations or requirements in addition to those set out in these Articles.
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SHARE CAPITAL
3. (1) The share capital of the Company
at the date on which these Articles come into effect shall be divided into shares of a par value of $0.0001 each.
(2) Subject
to the Act, the Company’s Memorandum and Articles of Association and, where applicable, the rules of the Designated Stock Exchange
and/or any competent regulatory authority, any power of the Company to purchase or otherwise acquire its own shares shall be exercisable
by the Board in such manner, upon such terms and subject to such conditions as it thinks fit.
(3) No
share shall be issued to bearer.
(4) The
Board may accept the surrender for no consideration of any fully paid share.
(5) No
share shall be issued to bearer.
ALTERATION OF CAPITAL
4. The Company may from time to time by
ordinary resolution in accordance with the Act alter the conditions of its Memorandum of Association to:
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(a)
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increase its capital by such sum, to be divided into shares of such amounts, as the resolution shall prescribe;
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(b)
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consolidate and divide all or any of its capital into shares of larger amount than its existing shares;
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(c)
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without prejudice to the powers of the Board under Article 12, divide its shares into several classes
and without prejudice to any special rights previously conferred on the holders of existing shares attach thereto respectively any preferential,
deferred, qualified or special rights, privileges, conditions or such restrictions which in the absence of any such determination by the
Company in general meeting, as the Directors may determine provided always that, for the avoidance of doubt, where a class of shares has
been authorized by the Company no resolution of the Company in general meeting is required for the issuance of shares of that class and
the Directors may issue shares of that class and determine such rights, privileges, conditions or restrictions attaching thereto as aforesaid,
and further provided that where the Company issues shares which do not carry voting rights, the words “non-voting” shall appear
in the designation of such shares and where the equity capital includes shares with different voting rights, the designation of each class
of shares, other than those with the most favourable voting rights, must include the words “restricted voting” or “limited
voting”;
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(d)
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sub-divide its shares, or any of them, into shares of smaller amount than is fixed by the Memorandum of
Association (subject, nevertheless, to the Act), and may by such resolution determine that, as between the holders of the shares resulting
from such sub-division, one or more of the shares may have any such preferred, deferred or other rights or be subject to any such restrictions
as compared with the other or others as the Company has power to attach to unissued or new shares;
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(e)
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cancel any shares which, at the date of the passing of the resolution, have not been taken, or agreed
to be taken, by any person, and diminish the amount of its capital by the amount of the shares so cancelled or, in the case of shares,
without par value, diminish the number of shares into which its capital is divided.
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5. The Board may settle as it considers
expedient any difficulty which arises in relation to any consolidation and division under the last preceding Article and in
particular but without prejudice to the generality of the foregoing may issue certificates in respect of fractions of shares or
arrange for the sale of the shares representing fractions and the distribution of the net proceeds of sale (after deduction of the
expenses of such sale) in due proportion amongst the Members who would have been entitled to the fractions, and for this purpose the
Board may authorise some person to transfer the shares representing fractions to their purchaser or resolve that such net proceeds
be paid to the Company for the Company’s benefit. Such purchaser will not be bound to see to the application of the purchase
money nor will his title to the shares be affected by any irregularity or invalidity in the proceedings relating to the sale.
6. The Company may from time to time by special
resolution, subject to any confirmation or consent required by the Act, reduce its share capital or any capital redemption reserve in
any manner permitted by law.
7. Except so far as otherwise provided by the
conditions of issue, or by these Articles, any capital raised by the creation of new shares shall be treated as if it formed part of the
original capital of the Company, and such shares shall be subject to the provisions contained in these Articles with reference to the
payment of calls and instalments, transfer and transmission, forfeiture, lien, cancellation, surrender, voting and otherwise.
SHARE RIGHTS
8. Subject to the provisions of the Act, the
Designated Stock Exchange Rules and the Memorandum and Articles of Association and to any special rights conferred on the holders of any
shares or class of shares, and without prejudice to Article 12 hereof, any share in the Company (whether forming part of the present capital
or not) may be issued with or have attached thereto such rights or restrictions whether in regard to dividend, voting, return of capital
or otherwise as the Board may determine, including without limitation on terms that they may be, or at the option of the Company or the
holder are, liable to be redeemed on such terms and in such manner, including out of capital, as the Board may deem fit.
9. Subject to the Act, any preferred shares
may be issued or converted into shares that, at a determinable date or at the option of the Company or the holder thereof, are to be redeemed
or are liable to be redeemed on such terms and in such manner as the Directors may in their absolute discretion determine.
VARIATION OF RIGHTS
10. Subject to the Act and without prejudice
to Article 8, all or any of the special rights for the time being attached to the shares or any class of shares may, unless otherwise
provided by the terms of issue of the shares of that class, from time to time (whether or not the Company is being wound up) be varied,
modified or abrogated with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of that
class. To every such separate general meeting, all the provisions of these Articles relating to general meetings of the Company shall,
mutatis mutandis, apply, but so that:
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(a)
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the necessary quorum (whether at a separate general meeting or at its adjourned meeting) shall be a person
or persons (or in the case of a Member being a corporation, its duly authorized representative) together holding or representing by proxy
not less than one-third of the votes attached to the issued shares of that class;
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(b)
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every holder of shares of the class shall be entitled on a poll to one vote for every such share held
by him; and
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(c)
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any holder of shares of the class present in person or by proxy or authorised representative may demand
a poll.
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11. The special rights conferred upon the holders
of any shares or class of shares shall not, unless otherwise expressly provided in the rights attaching to or the terms of issue of such
shares, be deemed to be varied, modified or abrogated by the creation or issue of further shares ranking pari passu therewith.
SHARES
12. (1) Subject to the Act, these Articles
and, where applicable, the rules of the Designated Stock Exchange and without prejudice to any special rights or restrictions for the
time being attached to any shares or any class of shares, the unissued shares of the Company (whether forming part of the original or
any increased capital) shall be at the disposal of the Board, which may offer, allot, grant options over or otherwise dispose of them
to such persons, at such times and for such consideration and upon such terms and conditions as the Board may in its absolute discretion
determine but so that no shares shall be issued at a discount to their par value. In particular and without prejudice to the generality
of the foregoing, the Board is hereby empowered to authorize by resolution or resolutions from time to time the issuance of one or more
classes or series of preferred shares and to fix the designations, powers, preferences and relative, participating, optional and other
rights, if any, and the qualifications, limitations and restrictions thereof, if any, including, without limitation, the number of shares
constituting each such class or series, dividend rights, conversion rights, redemption privileges, voting powers, full or limited or no
voting powers, and liquidation preferences, and to increase or decrease the size of any such class or series (but not below the number
of shares of any class or series of preferred shares then outstanding) to the extent permitted by law. Without limiting the generality
of the foregoing, the resolution or resolutions providing for the establishment of any class or series of preferred shares may, to the
extent permitted by law, provide that such class or series shall be superior to, rank equally with or be junior to the preferred shares
of any other class or series.
(2) Neither
the Company nor the Board shall be obliged, when making or granting any allotment of, offer of, option over or disposal of shares, to
make, or make available, any such allotment, offer, option or shares to Members or others with registered addresses in any particular
territory or territories being a territory or territories where, in the absence of a registration statement or other special formalities,
this would or might, in the opinion of the Board, be unlawful or impracticable. Members affected as a result of the foregoing sentence
shall not be, or be deemed to be, a separate class of members for any purpose whatsoever. Except as otherwise expressly provided in the
resolution or resolutions providing for the establishment of any class or series of preferred shares, no vote of the holders of preferred
shares or ordinary shares shall be a prerequisite to the issuance of any shares of any class or series of the preferred shares authorized
by and complying with the conditions of the Memorandum and Articles of Association.
(3) The
Board may issue options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof
to subscribe for, purchase or receive any class of shares or securities in the capital of the Company on such terms as it may from time
to time determine.
13. The Company may in connection with the
issue of any shares exercise all powers of paying commission and brokerage conferred or permitted by the Act. Subject to the Act, the
commission may be satisfied by the payment of cash or by the allotment of fully or partly paid shares or partly in one and partly in the
other.
14. Except as required by law, no person shall
be recognised by the Company as holding any share upon any trust and the Company shall not be bound by or required in any way to recognise
(even when having notice thereof) any equitable, contingent, future or partial interest in any share or any fractional part of a share
or (except only as otherwise provided by these Articles or by law) any other rights in respect of any share except an absolute right to
the entirety thereof in the registered holder.
15. Subject to the Act and these Articles,
the Board may at any time after the allotment of shares but before any person has been entered in the Register as the holder, recognise
a renunciation thereof by the allottee in favour of some other person and may accord to any allottee of a share a right to effect such
renunciation upon and subject to such terms and conditions as the Board considers fit to impose.
SHARE CERTIFICATES
16. Any share certificate(s) issued by the
Company shall be issued under the Seal or a facsimile thereof and shall specify the number and class and distinguishing numbers (if any)
of the shares to which it relates, and the amount paid up thereon and may otherwise be in such form as the Directors may from time to
time determine. No certificate shall be issued representing shares of more than one class. The Board may by resolution determine, either
generally or in any particular case or cases, that any signatures on any such certificates (or certificates in respect of other securities)
need not be autographic but may be affixed to such certificates by some mechanical means or may be printed thereon.
17. (1) In the case of a share held jointly
by several persons, the Company shall not be bound to issue more than one certificate therefor and delivery of a certificate to one of
several joint holders shall be sufficient delivery to all such holders.
(2) Where
a share stands in the names of two or more persons, the person first named in the Register shall as regards service of notices and, subject
to the provisions of these Articles, all or any other matters connected with the Company, except the transfer of the shares, be deemed
the sole holder thereof.
18. The Company is not obligated to issue a
share certificate to a Member unless the Member requests it in writing from the Company. Every person whose name is entered, upon an allotment
of shares, as a Member in the Register shall be entitled upon written request by such Member to the Company, to receive one certificate
for all such shares of any one class or several certificates each for one or more of such shares of such class upon payment for every
certificate of such fee as is provided in Article 20(2).
19. Upon request by a Member, and receipt of
all amounts required under Article 20(2), a share certificate shall be issued within the relevant time limit as prescribed by the Act
or as the Designated Stock Exchange may from time to time determine, whichever is the shorter, after allotment or, except in the case
of a transfer which the Company is for the time being entitled to refuse to register and does not register, after lodgment of a transfer
with the Company.
20. (1) Upon every transfer of shares the
certificate held by the transferor shall be given up to be cancelled, and shall forthwith be cancelled accordingly, and a new certificate
may be issued to the transferee (upon written request of the transferee) in respect of the shares transferred to him at such fee as is
provided in paragraph (2) of this Article. If any of the shares included in the certificate so given up shall be retained by the transferor
a new certificate for the balance may be issued to him at the aforesaid fee payable by the transferor to the Company in respect thereof.
(2) The
fee referred to in paragraph (1) above shall be an amount not exceeding the relevant maximum amount as the Designated Stock Exchange may
from time to time determine provided that the Board may at any time determine a lower amount for such fee.
21. If a share certificate shall be damaged
or defaced or alleged to have been lost, stolen or destroyed a new certificate representing the same shares may be issued to the relevant
Member upon request and on payment of such fee as the Company may determine and, subject to compliance with such terms (if any) as to
evidence and indemnity and to payment of the costs and reasonable out-of-pocket expenses of the Company in investigating such evidence
and preparing such indemnity as the Board may think fit and, in case of damage or defacement, on delivery of the old certificate to the
Company provided always that where share warrants have been issued, no new share warrant shall be issued to replace one that has been
lost unless the Board has determined that the original has been destroyed.
LIEN
22. The Company shall have a first and paramount
lien on every share that is not a fully paid share, for all moneys (whether presently payable or not) called or payable at a fixed time
in respect of that share. The Company shall also have a first and paramount lien on every share that is not a fully paid share registered
in the name of a Member (whether or not jointly with other Members) for all amounts of money presently payable by such Member or his estate
to the Company whether the same shall have been incurred before or after notice to the Company of any equitable or other interest of any
person other than such member, and whether the period for the payment or discharge of the same shall have actually arrived or not, and
notwithstanding that the same are joint debts or liabilities of such Member or his estate and any other person, whether a Member of the
Company or not. The Company’s lien on a share shall extend to all dividends or other moneys payable thereon or in respect thereof.
The Board may at any time, generally or in any particular case, waive any lien that has arisen or declare any share exempt in whole or
in part, from the provisions of this Article.
23. Subject to these Articles, the Company
may sell in such manner as the Board determines any share on which the Company has a lien, but no sale shall be made unless some sum in
respect of which the lien exists is presently payable, or the liability or engagement in respect of which such lien exists is liable to
be presently fulfilled or discharged nor until the expiration of fourteen (14) clear days after a notice in writing, stating and demanding
payment of the sum presently payable, or specifying the liability or engagement and demanding fulfilment or discharge thereof and giving
notice of the intention to sell in default, has been served on the registered holder for the time being of the share or the person entitled
thereto by reason of his death or bankruptcy.
24. The net proceeds of the sale shall be received
by the Company and applied in or towards payment or discharge of the debt or liability in respect of which the lien exists, so far as
the same is presently payable, and any residue shall (subject to a like lien for debts or liabilities not presently payable as existed
upon the share prior to the sale) be paid to the person entitled to the share at the time of the sale. To give effect to any such sale
the Board may authorise some person to transfer the shares sold to the purchaser thereof. The purchaser shall be registered as the holder
of the shares so transferred and he shall not be bound to see to the application of the purchase money, nor shall his title to the shares
be affected by any irregularity or invalidity in the proceedings relating to the sale.
CALLS ON SHARES
25. Subject to these Articles and to the terms
of allotment, the Board may from time to time make calls upon the Members in respect of any moneys unpaid on their shares (whether on
account of the nominal value of the shares or by way of premium), and each Member shall (subject to being given at least fourteen (14)
clear days’ Notice specifying the time and place of payment) pay to the Company as required by such notice the amount called on
his shares. A call may be extended, postponed or revoked in whole or in part as the Board determines but no member shall be entitled to
any such extension, postponement or revocation except as a matter of grace and favour.
26. A call shall be deemed to have been made
at the time when the resolution of the Board authorising the call was passed and may be made payable either in one lump sum or by instalments.
27. A person upon whom a call is made shall
remain liable for calls made upon him notwithstanding the subsequent transfer of the shares in respect of which the call was made. The
joint holders of a share shall be jointly and severally liable to pay all calls and instalments due in respect thereof or other moneys
due in respect thereof.
28. If a sum called in respect of a share is
not paid before or on the day appointed for payment thereof, the person from whom the sum is due shall pay interest on the amount unpaid
from the day appointed for payment thereof to the time of actual payment at such rate (not exceeding twenty per cent. (20%) per annum)
as the Board may determine, but the Board may in its absolute discretion waive payment of such interest wholly or in part.
29. No Member shall be entitled to receive
any dividend or bonus or to be present and vote (save as proxy for another Member) at any general meeting either personally or by proxy,
or be reckoned in a quorum, or exercise any other privilege as a Member until all calls or instalments due by him to the Company, whether
alone or jointly with any other person, together with interest and expenses (if any) shall have been paid.
30. On the trial or hearing of any action or
other proceedings for the recovery of any money due for any call, it shall be sufficient to prove that the name of the Member sued is
entered in the Register as the holder, or one of the holders, of the shares in respect of which such debt accrued, that the resolution
making the call is duly recorded in the minute book, and that notice of such call was duly given to the Member sued, in pursuance of these
Articles; and it shall not be necessary to prove the appointment of the Directors who made such call, nor any other matters whatsoever,
but the proof of the matters aforesaid shall be conclusive evidence of the debt.
31. Any amount payable in respect of a share
upon allotment or at any fixed date, whether in respect of nominal value or premium or as an instalment of a call, shall be deemed to
be a call duly made and payable on the date fixed for payment and if it is not paid the provisions of these Articles shall apply as if
that amount had become due and payable by virtue of a call duly made and notified.
32. On the issue of shares the Board may differentiate
between the allottees or holders as to the amount of calls to be paid and the times of payment.
33. The Board may, if it thinks fit, receive
from any Member willing to advance the same, and either in money or money’s worth, all or any part of the moneys uncalled and unpaid
or instalments payable upon any shares held by him and upon all or any of the moneys so advanced (until the same would, but for such advance,
become presently payable) pay interest at such rate (if any) as the Board may decide. The Board may at any time repay the amount so advanced
upon giving to such Member not less than one month’s Notice of its intention in that behalf, unless before the expiration of such
notice the amount so advanced shall have been called up on the shares in respect of which it was advanced. Such payment in advance shall
not entitle the holder of such share or shares to participate in respect thereof in a dividend subsequently declared.
FORFEITURE OF SHARES
34. (1) If a call remains unpaid after it
has become due and payable the Board may give to the person from whom it is due not less than fourteen (14) clear days’ Notice:
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(a)
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requiring payment of the amount unpaid together with any interest which may have accrued and which may
still accrue up to the date of actual payment; and
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(b)
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stating that if the Notice is not complied with the shares on which the call was made will be liable to
be forfeited.
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(2) If
the requirements of any such Notice are not complied with, any share in respect of which such Notice has been given may at any time thereafter,
before payment of all calls and interest due in respect thereof has been made, be forfeited by a resolution of the Board to that effect,
and such forfeiture shall include all dividends and bonuses declared in respect of the forfeited share but not actually paid before the
forfeiture.
35. When any share has been forfeited, notice
of the forfeiture shall be served upon the person who was before forfeiture the holder of the share. No forfeiture shall be invalidated
by any omission or neglect to give such Notice.
36. The Board may accept the surrender of any
share liable to be forfeited hereunder and, in such case, references in these Articles to forfeiture will include surrender.
37. Any share so forfeited shall be deemed
the property of the Company and may be sold, re-allotted or otherwise disposed of to such person, upon such terms and in such manner as
the Board determines, and at any time before a sale, re-allotment or disposition the forfeiture may be annulled by the Board on such terms
as the Board determines.
38. A person whose shares have been forfeited
shall cease to be a Member in respect of the forfeited shares but nevertheless shall remain liable to pay the Company all moneys which
at the date of forfeiture were presently payable by him to the Company in respect of the shares, with (if the Directors shall in their
discretion so require) interest thereon from the date of forfeiture until payment at such rate (not exceeding twenty per cent. (20%) per
annum) as the Board determines. The Board may enforce payment thereof if it thinks fit, and without any deduction or allowance for the
value of the forfeited shares, at the date of forfeiture, but his liability shall cease if and when the Company shall have received payment
in full of all such moneys in respect of the shares. For the purposes of this Article any sum which, by the terms of issue of a share,
is payable thereon at a fixed time which is subsequent to the date of forfeiture, whether on account of the nominal value of the share
or by way of premium, shall notwithstanding that time has not yet arrived be deemed to be payable at the date of forfeiture, and the same
shall become due and payable immediately upon the forfeiture, but interest thereon shall only be payable in respect of any period between
the said fixed time and the date of actual payment.
39. A declaration by a Director or the Secretary
that a share has been forfeited on a specified date shall be conclusive evidence of the facts therein stated as against all persons claiming
to be entitled to the share, and such declaration shall (subject to the execution of an instrument of transfer by the Company if necessary)
constitute a good title to the share, and the person to whom the share is disposed of shall be registered as the holder of the share and
shall not be bound to see to the application of the consideration (if any), nor shall his title to the share be affected by any irregularity
in or invalidity of the proceedings in reference to the forfeiture, sale or disposal of the share. When any share shall have been forfeited,
notice of the declaration shall be given to the Member in whose name it stood immediately prior to the forfeiture, and an entry of the
forfeiture, with the date thereof, shall forthwith be made in the register, but no forfeiture shall be in any manner invalidated by any
omission or neglect to give such notice or make any such entry.
40. Notwithstanding any such forfeiture as
aforesaid, the Board may at any time, before any shares so forfeited shall have been sold, re-allotted or otherwise disposed of, permit
the shares forfeited to be bought back upon the terms of payment of all calls and interest due upon and expenses incurred in respect of
the share, and upon such further terms (if any) as it thinks fit.
41. The forfeiture of a share shall not prejudice
the right of the Company to any call already made or instalment payable thereon.
42. The provisions of these Articles as to
forfeiture shall apply in the case of non-payment of any sum which, by the terms of issue of a share, becomes payable at a fixed time,
whether on account of the nominal value of the share or by way of premium, as if the same had been payable by virtue of a call duly made
and notified.
REGISTER OF MEMBERS
43. (1) The Company shall keep in one or
more books a Register of its Members and shall enter therein the following particulars, that is to say:
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(a)
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the name and address of each Member, the number and class of shares held by him and the amount paid or
agreed to be considered as paid on such shares;
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(b)
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the date on which each person was entered in the Register; and
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(c)
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the date on which any person ceased to be a Member.
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(2) The
Company may keep an overseas or local or other branch register of Members resident in any place, and the Board may make and vary such
regulations as it determines in respect of the keeping of any such register and maintaining a Registration Office in connection therewith.
44. The Register and branch register of Members,
as the case may be, shall be open to inspection for such times and on such days as the Board shall determine by Members without charge
or by any other person, upon a maximum payment of $2.50 or such other sum specified by the Board, at the Office or Registration Office
or such other place at which the Register is kept in accordance with the Act. The Register including any overseas or local or other branch
register of Members may, after compliance with any notice requirement of the Designated Stock Exchange , be closed at such times or for
such periods not exceeding in the whole thirty (30) days in each year as the Board may determine and either generally or in respect of
any class of shares.
RECORD DATES
45. For the purpose of determining the Members
entitled to notice of or to vote at any general meeting, or any adjournment thereof, or entitled to express consent to corporate action
in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled
to exercise any rights in respect of any change, conversion or exchange of shares or for the purpose of any other lawful action, the Board
may fix, in advance, a date as the record date for any such determination of Members, which date shall not be more than sixty (60) days
nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other such action.
If the Board does not fix a
record date for any general meeting, the record date for determining the Members entitled to a notice of or to vote at such meeting shall
be at the close of business on the day next preceding the day on which notice is given, or, if in accordance with these Articles notice
is waived, at the close of business on the day next preceding the day on which the meeting is held. The record date for determining the
Members for any other purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto.
A determination of the Members
of record entitled to notice of or to vote at a meeting of the Members shall apply to any adjournment of the meeting; provided, however,
that the Board may fix a new record date for the adjourned meeting.
TRANSFER OF SHARES
46. Subject to these Articles, any Member may
transfer all or any of his shares by an instrument of transfer in the usual or common form or in a form prescribed by the Designated Stock
Exchange or in any other form approved by the Board and may be under hand or, if the transferor or transferee is a clearing house or a
central depository house or its nominee(s), by hand or by machine imprinted signature or by such other manner of execution as the Board
may approve from time to time.
47. The instrument of transfer shall be executed
by or on behalf of the transferor and the transferee provided that the Board may dispense with the execution of the instrument of transfer
by the transferee in any case which it thinks fit in its discretion to do so. Without prejudice to the last preceding Article, the Board
may also resolve, either generally or in any particular case, upon request by either the transferor or transferee, to accept mechanically
executed transfers. The transferor shall be deemed to remain the holder of the share until the name of the transferee is entered in the
Register in respect thereof. Nothing in these Articles shall preclude the Board from recognising a renunciation of the allotment or provisional
allotment of any share by the allottee in favour of some other person.
48. (1) The Board may, in its absolute discretion,
and without giving any reason therefor, refuse to register a transfer of any share (not being a fully paid up share) to a person of whom
it does not approve, or any share issued under any share incentive scheme for employees upon which a restriction on transfer imposed thereby
still subsists, and it may also, without prejudice to the foregoing generality, refuse to register a transfer of any share to more than
four joint holders or a transfer of any share (not being a fully paid up share) on which the Company has a lien.
(2) The
Board in so far as permitted by any applicable law may, in its absolute discretion, at any time and from time to time transfer any share
upon the Register to any branch register or any share on any branch register to the Register or any other branch register. In the event
of any such transfer, the Member requesting such transfer shall bear the cost of effecting the transfer unless the Board otherwise determines.
(3) Unless
the Board otherwise agrees (which agreement may be on such terms and subject to such conditions as the Board in its absolute discretion
may from time to time determine, and which agreement the Board shall, without giving any reason therefor, be entitled in its absolute
discretion to give or withhold), no shares upon the Register shall be transferred to any branch register nor shall shares on any branch
register be transferred to the Register or any other branch register and all transfers and other documents of title shall be lodged for
registration, and registered, in the case of any shares on a branch register, at the relevant Registration Office, and, in the case of
any shares on the Register, at the Office or such other place at which the Register is kept in accordance with the Act.
49. Without limiting the generality of the
last preceding Article, the Board may decline to recognise any instrument of transfer unless:-
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(a)
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a fee of such maximum sum as the Designated Stock Exchange may determine to be payable or such lesser
sum as the Board may from time to time require is paid to the Company in respect thereof;
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(b)
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the instrument of transfer is in respect of only one class of share;
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(c)
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the instrument of transfer is lodged at the Office or such other place at which the Register is kept in
accordance with the Act or the Registration Office (as the case may be) accompanied by the relevant share certificate(s) and such other
evidence as the Board may reasonably require to show the right of the transferor to make the transfer (and, if the instrument of transfer
is executed by some other person on his behalf, the authority of that person so to do); and
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(d)
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if applicable, the instrument of transfer is duly and properly stamped.
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50. If the Board refuses to register a transfer
of any share, it shall, within three months after the date on which the transfer was lodged with the Company, send to each of the transferor
and transferee notice of the refusal.
51. The registration of transfers of shares
or of any class of shares may, after compliance with any notice requirement of the Designated Stock Exchange, be suspended at such times
and for such periods (not exceeding in the whole thirty (30) days in any year) as the Board may determine.
TRANSMISSION OF SHARES
52. If a Member dies, the survivor or survivors
where the deceased was a joint holder, and his legal personal representatives where he was a sole or only surviving holder, will be the
only persons recognised by the Company as having any title to his interest in the shares; but nothing in this Article will release the
estate of a deceased Member (whether sole or joint) from any liability in respect of any share which had been solely or jointly held by
him.
53. Any person becoming entitled to a share
in consequence of the death or bankruptcy or winding-up of a Member may, upon such evidence as to his title being produced as may be required
by the Board, elect either to become the holder of the share or to have some person nominated by him registered as the transferee thereof.
If he elects to become the holder he shall notify the Company in writing either at the Registration Office or Office, as the case may
be, to that effect. If he elects to have another person registered he shall execute a transfer of the share in favour of that person.
The provisions of these Articles relating to the transfer and registration of transfers of shares shall apply to such notice or transfer
as aforesaid as if the death or bankruptcy of the Member had not occurred and the notice or transfer were a transfer signed by such Member.
54. A person becoming entitled to a share by
reason of the death or bankruptcy or winding-up of a Member shall be entitled to the same dividends and other advantages to which he would
be entitled if he were the registered holder of the share. However, the Board may, if it thinks fit, withhold the payment of any dividend
payable or other advantages in respect of such share until such person shall become the registered holder of the share or shall have effectually
transferred such share, but, subject to the requirements of Article 75(2) being met, such a person may vote at meetings.
UNTRACEABLE MEMBERS
55. (1) Without prejudice to the rights
of the Company under paragraph (2) of this Article, the Company may cease sending cheques for dividend entitlements or dividend warrants
by post if such cheques or warrants have been left uncashed on two consecutive occasions. However, the Company may exercise the power
to cease sending cheques for dividend entitlements or dividend warrants after the first occasion on which such a cheque or warrant is
returned undelivered.
(2) The
Company shall have the power to sell, in such manner as the Board thinks fit, any shares of a Member who is untraceable, but no such sale
shall be made unless:
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(a)
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all cheques or warrants in respect of dividends of the shares in question, being not less than three in
total number, for any sum payable in cash to the holder of such shares in respect of them sent during the relevant period in the manner
authorised by the Articles of the Company have remained uncashed;
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(b)
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so far as it is aware at the end of the relevant period, the Company has not at any time during the relevant
period received any indication of the existence of the Member who is the holder of such shares or of a person entitled to such shares
by death, bankruptcy or operation of law; and
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(c)
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the Company, if so required by the rules governing the listing of shares on the Designated Stock Exchange,
has given notice to, and caused advertisement in newspapers to be made in accordance with the requirements of, the Designated Stock Exchange
of its intention to sell such shares in the manner required by the Designated Stock Exchange, and a period of three months or such shorter
period as may be allowed by the Designated Stock Exchange has elapsed since the date of such advertisement.
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For the purpose of the foregoing,
the “relevant period” means the period commencing twelve (12) years before the date of publication of the advertisement referred
to in paragraph (c) of this Article and ending at the expiry of the period referred to in that paragraph.
(3) To
give effect to any such sale the Board may authorise some person to transfer the said shares and an instrument of transfer signed or otherwise
executed by or on behalf of such person shall be as effective as if it had been executed by the registered holder or the person entitled
by transmission to such shares, and the purchaser shall not be bound to see to the application of the purchase money nor shall his title
to the shares be affected by any irregularity or invalidity in the proceedings relating to the sale. The net proceeds of the sale will
belong to the Company and upon receipt by the Company of such net proceeds it shall become indebted to the former Member for an amount
equal to such net proceeds. No trust shall be created in respect of such debt and no interest shall be payable in respect of it and the
Company shall not be required to account for any money earned from the net proceeds which may be employed in the business of the Company
or as it thinks fit. Any sale under this Article shall be valid and effective notwithstanding that the Member holding the shares sold
is dead, bankrupt or otherwise under any legal disability or incapacity.
GENERAL MEETINGS
56. The Company may hold an annual general
meeting and shall specify the meeting as such in the Notice calling it. An annual general meeting of the Company shall be held at such
time and place as may be determined by the Board.
57. Each general meeting, other than an annual
general meeting, shall be called an extraordinary general meeting. General meetings may be held at such times and in any location in the
world as may be determined by the Board.
58. Only a majority of the Board or the Chairman
of the Board may call general meetings, which general meetings shall be held at such times and locations (as permitted hereby) as such
person or persons shall determine.
NOTICE OF GENERAL MEETINGS
59. (1) An annual general meeting and any
extraordinary general meeting may be called by not less than ten (10) clear days’ Notice but a general meeting may be called by
shorter notice, subject to the Act, if it is so agreed:
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(a)
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in the case of a meeting called as an annual general meeting, by all the Members entitled to attend and
vote thereat; and
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(b)
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in the case of any other meeting, by a majority in number of the Members having the right to attend and
vote at the meeting, being a majority together holding not less than ninety-five per cent. (95%) in nominal value of the issued shares
giving that right.
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(2) The
Notice shall specify the time and place of the meeting and, in case of special business, the general nature of the business. The notice
convening an annual general meeting shall specify the meeting as such. Notice of every general meeting shall be given to all Members other
than to such Members as, under the provisions of these Articles or the terms of issue of the shares they hold, are not entitled to receive
such notices from the Company, to all persons entitled to a share in consequence of the death or bankruptcy or winding-up of a Member
and to each of the Directors.
60. The accidental omission to give Notice
of a meeting or (in cases where instruments of proxy are sent out with the Notice) to send such instrument of proxy to, or the non-receipt
of such Notice or such instrument of proxy by, any person entitled to receive such Notice shall not invalidate any resolution passed or
the proceedings at that meeting.
PROCEEDINGS AT GENERAL MEETINGS
61.
(1) All business shall be deemed special that is transacted at an extraordinary general meeting, and also all business that is transacted
at an annual general meeting, with the exception of the election of Directors.
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(2)
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No business other than the appointment of a chairman of a meeting shall be transacted at any general meeting
unless a quorum is present at the commencement of the business. At any general meeting of the Company, two (2) Members entitled to vote
and present in person or by proxy or (in the case of a Member being a corporation) by its duly authorised representative representing
not less than one-third of the votes attached to the then issued share capital of the Company throughout the meeting shall form a quorum
for all purposes.
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62. If within thirty (30) minutes (or such
longer time not exceeding one hour as the chairman of the meeting may determine to wait) after the time appointed for the meeting a quorum
is not present, the meeting shall stand adjourned to the same day in the next week at the same time and place or to such time and place
as the Board may determine. If at such adjourned meeting a quorum is not present within half an hour from the time appointed for holding
the meeting, the meeting shall be dissolved.
63. The Chairman of the Board shall preside
as chairman at every general meeting. If at any meeting the chairman is not present within fifteen (15) minutes after the time appointed
for holding the meeting, or is not willing to act as chairman, the Directors present shall choose one of their number to act, or if one
Director only is present he shall preside as chairman if willing to act. If no Director is present, or if each of the Directors present
declines to take the chair, or if the chairman chosen shall retire from the chair, the Members present in person or by proxy and entitled
to vote shall elect one of their number to be chairman.
64. The chairman may adjourn the meeting from
time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business which might
lawfully have been transacted at the meeting had the adjournment not taken place. When a meeting is adjourned for fourteen (14) days or
more, at least seven (7) clear days’ notice of the adjourned meeting shall be given specifying the time and place of the adjourned
meeting but it shall not be necessary to specify in such notice the nature of the business to be transacted at the adjourned meeting and
the general nature of the business to be transacted. Save as aforesaid, it shall be unnecessary to give notice of an adjournment.
65. If an amendment is proposed to any resolution
under consideration but is in good faith ruled out of order by the chairman of the meeting, the proceedings on the substantive resolution
shall not be invalidated by any error in such ruling. In the case of a resolution duly proposed as a special resolution, no amendment
thereto (other than a mere clerical amendment to correct a patent error) may in any event be considered or voted upon.
VOTING
66. Subject to any special rights or restrictions
as to voting for the time being attached to any shares by or in accordance with these Articles, at any general meeting on a show of hands
every Member present in person (or being a corporation, is present by a duly authorised representative), or by proxy shall have one vote
and on a poll every Member present in person or by proxy or, in the case of a Member being a corporation, by its duly authorised representative
shall have one vote for every fully paid share of which he is the holder but so that no amount paid up or credited as paid up on a share
in advance of calls or instalments is treated for the foregoing purposes as paid up on the share. Notwithstanding anything contained in
these Articles, where more than one proxy is appointed by a Member which is a clearing house or a central depository house (or its nominee(s)),
each such proxy shall have one vote on a show of hands. A resolution put to the vote of a meeting shall be decided on a show of hands
unless (before or on the declaration of the result of the show of hands or on the withdrawal of any other demand for a poll) a poll is
demanded by the chairman of such meeting or by any one or more Members who together hold not less than ten percent (10%) of the votes
attached to the then issued share capital of the Company, present in person or in the case of a Member being a corporation by its duly
authorised representative or by proxy for the time being entitled to vote at the meeting. A demand by a person as proxy for a Member or
in the case of a Member being a corporation by its duly authorised representative shall be deemed to be the same as a demand by a Member.
67. Unless a poll is duly demanded and the
demand is not withdrawn, a declaration by the chairman that a resolution has been carried, or carried unanimously, or by a particular
majority, or not carried by a particular majority, or lost, and an entry to that effect made in the minute book of the Company, shall
be conclusive evidence of the facts without proof of the number or proportion of the votes recorded for or against the resolution.
68. If a poll is duly demanded the result of
the poll shall be deemed to be the resolution of the meeting at which the poll was demanded. There shall be no requirement for the chairman
to disclose the voting figures on a poll.
69. A poll demanded on the election of a chairman,
or on a question of adjournment, shall be taken forthwith. A poll demanded on any other question shall be taken in such manner (including
the use of ballot or voting papers or tickets) either forthwith or at such time (being not later than thirty (30) days after the date
of the demand) and place as the chairman directs. It shall not be necessary (unless the chairman otherwise directs) for notice to be given
of a poll not taken immediately.
70. The demand for a poll shall not prevent
the continuance of a meeting or the transaction of any business other than the question on which the poll has been demanded, and, with
the consent of the chairman, it may be withdrawn at any time before the close of the meeting or the taking of the poll, whichever is the
earlier.
71. On a poll votes may be given either personally
or by proxy.
72. A person entitled to more than one vote
on a poll need not use all his votes or cast all the votes he uses in the same way.
73. All questions submitted to a meeting shall
be decided by a simple majority of votes cast by such Members as, being entitled to do so, vote in person or, by proxy or, in the case
of a Member being a corporation, by its duly authorised representative except where a greater majority is required by these Articles or
by the Act. In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of such meeting shall be entitled
to a second or casting vote in addition to any other vote he may have.
74. Where there are joint holders of any share
any one of such joint holder may vote, either in person or by proxy, in respect of such share as if he were solely entitled thereto, but
if more than one of such joint holders be present at any meeting the vote of the senior who tenders a vote, whether in person or by proxy,
shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the
order in which the names stand in the Register in respect of the joint holding. Several executors or administrators of a deceased Member
in whose name any share stands shall for the purposes of this Article be deemed joint holders thereof.
75. (1) A Member who is a patient for any
purpose relating to mental health or in respect of whom an order has been made by any court having jurisdiction for the protection or
management of the affairs of persons incapable of managing their own affairs may vote, whether on a show of hands or on a poll, by his
receiver, committee, curator bonis or other person in the nature of a receiver, committee or curator bonis appointed by such court, and
such receiver, committee, curator bonis or other person may vote on a poll by proxy, and may otherwise act and be treated as if he were
the registered holder of such shares for the purposes of general meetings, provided that such evidence as the Board may require of the
authority of the person claiming to vote shall have been deposited at the Office, head office or Registration Office, as appropriate,
not less than forty-eight (48) hours before the time appointed for holding the meeting, or adjourned meeting or poll, as the case may
be.
(2) Any person entitled
under Article 53 to be registered as the holder of any shares may vote at any general meeting in respect thereof in the same manner
as if he were the registered holder of such shares, provided that forty-eight (48) hours at least before the time of the holding of
the meeting or adjourned meeting, as the case may be, at which he proposes to vote, he shall satisfy the Board of his entitlement to
such shares, or the Board shall have previously admitted his right to vote at such meeting in respect thereof.
76. No Member shall, unless the Board otherwise
determines, be entitled to attend and vote and to be reckoned in a quorum at any general meeting unless he is duly registered and all
calls or other sums presently payable by him in respect of shares in the Company have been paid.
77. If:
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(a)
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any objection shall be raised to the qualification of any voter; or
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(b)
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any votes have been counted which ought not to have been counted or which might have been rejected; or
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(c)
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any votes are not counted which ought to have been counted;
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the objection or error shall
not vitiate the decision of the meeting or adjourned meeting on any resolution unless the same is raised or pointed out at the meeting
or, as the case may be, the adjourned meeting at which the vote objected to is given or tendered or at which the error occurs. Any objection
or error shall be referred to the chairman of the meeting and shall only vitiate the decision of the meeting on any resolution if the
chairman decides that the same may have affected the decision of the meeting. The decision of the chairman on such matters shall be final
and conclusive.
PROXIES
78. Any Member entitled to attend and vote
at a meeting of the Company shall be entitled to appoint another person as his proxy to attend and vote instead of him. A Member who is
the holder of two or more shares may appoint more than one proxy to represent him and vote on his behalf at a general meeting of the Company
or at a class meeting. A proxy need not be a Member. In addition, a proxy or proxies representing either a Member who is an individual
or a Member which is a corporation shall be entitled to exercise the same powers on behalf of the Member which he or they represent as
such Member could exercise.
79. The instrument appointing a proxy shall
be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either
under its seal or under the hand of an officer, attorney or other person authorised to sign the same. In the case of an instrument of
proxy purporting to be signed on behalf of a corporation by an officer thereof it shall be assumed, unless the contrary appears, that
such officer was duly authorised to sign such instrument of proxy on behalf of the corporation without further evidence of the facts.
80. The instrument appointing a proxy and (if
required by the Board) the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power or
authority, shall be delivered to such place or one of such places (if any) as may be specified for that purpose in or by way of note to
or in any document accompanying the notice convening the meeting (or, if no place is so specified at the Registration Office or the Office,
as may be appropriate) not less than forty-eight (48) hours before the time appointed for holding the meeting or adjourned meeting at
which the person named in the instrument proposes to vote or, in the case of a poll taken subsequently to the date of a meeting or adjourned
meeting, not less than twenty-four (24) hours before the time appointed for the taking of the poll and in default the instrument of proxy
shall not be treated as valid. No instrument appointing a proxy shall be valid after the expiration of twelve (12) months from the date
named in it as the date of its execution, except at an adjourned meeting or on a poll demanded at a meeting or an adjourned meeting in
cases where the meeting was originally held within twelve (12) months from such date. Delivery of an instrument appointing a proxy shall
not preclude a Member from attending and voting in person at the meeting convened and in such event, the instrument appointing a proxy
shall be deemed to be revoked.
81. Instruments of proxy shall be in any common
form or in such other form as the Board may approve (provided that this shall not preclude the use of the two-way form) and the Board
may, if it thinks fit, send out with the notice of any meeting forms of instrument of proxy for use at the meeting. The instrument of
proxy shall be deemed to confer authority to demand or join in demanding a poll and to vote on any amendment of a resolution put to the
meeting for which it is given as the proxy thinks fit. The instrument of proxy shall, unless the contrary is stated therein, be valid
as well for any adjournment of the meeting as for the meeting to which it relates.
82. A vote given in accordance with the terms
of an instrument of proxy shall be valid notwithstanding the previous death or insanity of the principal, or revocation of the instrument
of proxy or of the authority under which it was executed, provided that no intimation in writing of such death, insanity or revocation
shall have been received by the Company at the Office or the Registration Office (or such other place as may be specified for the delivery
of instruments of proxy in the notice convening the meeting or other document sent therewith) two (2) hours at least before the commencement
of the meeting or adjourned meeting, or the taking of the poll, at which the instrument of proxy is used.
83. Anything which under these Articles a Member
may do by proxy he may likewise do by his duly appointed attorney and the provisions of these Articles relating to proxies and instruments
appointing proxies shall apply mutatis mutandis in relation to any such attorney and the instrument under which such attorney is appointed.
CORPORATIONS ACTING BY REPRESENTATIVES
84. (1) Any corporation which is a Member
may by resolution of its directors or other governing body authorise such person as it thinks fit to act as its representative at any
meeting of the Company or at any meeting of any class of Members. The person so authorised shall be entitled to exercise the same powers
on behalf of such corporation as the corporation could exercise if it were an individual Member and such corporation shall for the purposes
of these Articles be deemed to be present in person at any such meeting if a person so authorised is present thereat.
(2) If
a clearing house (or its nominee(s)) or a central depository entity, being a corporation, is a Member, it may authorise such persons as
it thinks fit to act as its representatives at any meeting of the Company or at any meeting of any class of Members provided that the
authorisation shall specify the number and class of shares in respect of which each such representative is so authorised. Each person
so authorised under the provisions of this Article shall be deemed to have been duly authorised without further evidence of the facts
and be entitled to exercise the same rights and powers on behalf of the clearing house or central depository entity (or its nominee(s))
as if such person was the registered holder of the shares of the Company held by the clearing house or a central depository entity (or
its nominee(s)) including the right to vote individually on a show of hands.
(3) Any
reference in these Articles to a duly authorised representative of a Member being a corporation shall mean a representative authorised
under the provisions of this Article.
ACTION BY WRITTEN RESOLUTIONS OF MEMBERS
85. A
resolution in writing signed (in such manner as to indicate, expressly or impliedly, unconditional approval) by or on behalf of all persons
for the time being entitled to receive notice of and to attend and vote at general meetings of the Company shall, for the purposes of
these Articles, be treated as a resolution duly passed at a general meeting of the Company and, where relevant, as a special resolution
so passed. Any such resolution shall be deemed to have been passed at a meeting held on the date on which it was signed by the last Member
to sign, and where the resolution states a date as being the date of his signature thereof by any Member the statement shall be prima
facie evidence that it was signed by him on that date. Such a resolution may consist of several documents in the like form, each signed
by one or more relevant Members.
BOARD OF DIRECTORS
86. (1) Unless otherwise determined by the
Members in general meeting, the number of Directors shall not be less than two (2). There shall be no maximum number of Directors unless
otherwise determined from time to time by the Board. The Directors shall be elected or appointed in the first place by the subscribers
to the Memorandum of Association or by a majority of them and thereafter in accordance with Articles 86 and 87 and shall hold office until
their resignations from the Board, or their office is otherwise vacated, or until their successors are elected or appointed.
(2) Subject
to the Articles and the Act, the Members may by ordinary resolution elect any person to be a Director either to fill a casual vacancy
or as an addition to the existing Board.
(3) The
Directors shall have the power from time to time and at any time to appoint any person as a Director to fill a casual vacancy on the Board
or as an addition to the existing Board.
(4) No
Director shall be required to hold any shares of the Company by way of qualification and a Director who is not a Member shall be entitled
to receive notice of and to attend and speak at any general meeting of the Company and of all classes of shares of the Company.
(5) Subject
to any provision to the contrary in these Articles, a Director may be removed by way of an ordinary resolution of the Members at any time
before the expiration of his period of office notwithstanding anything in these Articles or in any agreement between the Company and such
Director (but without prejudice to any claim for damages under any such agreement).
(6) A
vacancy on the Board created by the removal of a Director under the provisions of subparagraph (5) above may be filled by the election
or appointment by ordinary resolution of the Members at the meeting at which such Director is removed or by the affirmative vote of a
simple majority of the remaining Directors present and voting at a Board meeting or by the affirmative vote of all of the remaining Directors
through a resolution in writing signed by such Directors.
(7) The
Board may from time to time by resolution increase or reduce the number of Directors but so that the number of Directors shall never be
less than two (2).
NO RETIREMENT OF DIRECTORS BY ROTATION
87. No Director(s) shall be required to retire
from office by rotation.
88. Unless otherwise provided by the Designated
Stock Exchange Rules, no person shall, unless recommended by the Directors for election, be eligible for election as a Director at any
general meeting.
DISQUALIFICATION OF DIRECTORS
89. The office of a Director shall be vacated
if the Director:
(1) resigns
his office by notice in writing delivered to the Company at the Office or tendered at a meeting of the Board;
(2)
becomes of unsound mind or dies;
(3) without
special leave of absence from the Board, is absent from meetings of the Board for six consecutive meetings and the Board resolves that
his office be vacated; or
(4) becomes
bankrupt or has a receiving order made against him or suspends payment or compounds with his creditors;
(5)
is prohibited by law from being a Director; or
(6) ceases
to be a Director by virtue of any provision of the Statutes or is removed from office pursuant to these Articles.
ALTERNATE DIRECTORS
90. Any Director may at any time by Notice
delivered to the Office or head office or at a meeting of the Directors appoint any person (including another Director) to be his alternate
Director. Any person so appointed shall have all the rights and powers of the Director or Directors for whom such person is appointed
in the alternative provided that such person shall not be counted more than once in determining whether or not a quorum is present. An
alternate Director may be removed at any time by the body which appointed him and, subject thereto, the office of alternate Director shall
continue until the happening of any event which, if he were a Director, would cause him to vacate such office or if his appointer ceases
for any reason to be a Director. Any appointment or removal of an alternate Director shall be effected by Notice signed by the appointor
and delivered to the Office or head office or tendered at a meeting of the Board. An alternate Director may also be a Director in his
own right and may act as alternate to more than one Director. An alternate Director shall, if his appointor so requests, be entitled to
receive notices of meetings of the Board or of committees of the Board to the same extent as, but in lieu of, the Director appointing
him and shall be entitled to such extent to attend and vote as a Director at any such meeting at which the Director appointing him is
not personally present and generally at such meeting to exercise and discharge all the functions, powers and duties of his appointor as
a Director and for the purposes of the proceedings at such meeting the provisions of these Articles shall apply as if he were a Director
save that as an alternate for more than one Director his voting rights shall be cumulative.
91. An alternate Director shall only be a Director
for the purposes of the Act and shall only be subject to the provisions of the Act insofar as they relate to the duties and obligations
of a Director when performing the functions of the Director for whom he is appointed in the alternative and shall alone be responsible
to the Company for his acts and defaults and shall not be deemed to be the agent of or for the Director appointing him. An alternate Director
shall be entitled to contract and be interested in and benefit from contracts or arrangements or transactions and to be repaid expenses
and to be indemnified by the Company to the same extent mutatis mutandis as if he were a Director but he shall not be entitled to receive
from the Company any fee in his capacity as an alternate Director except only such part, if any, of the remuneration otherwise payable
to his appointor as such appointor may by Notice to the Company from time to time direct.
92. Every person acting as an alternate Director
shall have one vote for each Director for whom he acts as alternate (in addition to his own vote if he is also a Director). If his appointor
is for the time being absent from the People’s Republic of China or otherwise not available or unable to act, the signature of an
alternate Director to any resolution in writing of the Board or a committee of the Board of which his appointor is a member shall, unless
the notice of his appointment provides to the contrary, be as effective as the signature of his appointor.
93. An alternate Director shall ipso facto
cease to be an alternate Director if his appointor ceases for any reason to be a Director, however, such alternate Director or any other
person may be re-appointed by the Directors to serve as an alternate Director PROVIDED always that, if at any meeting any Director retires
but is re-elected at the same meeting, any appointment of such alternate Director pursuant to these Articles which was in force immediately
before his retirement shall remain in force as though he had not retired.
DIRECTORS’ FEES AND EXPENSES
94. Subject to the Designated Exchange Rules,
the Directors shall receive such remuneration as the Board or a committee with such power delegated by the Board may from time to time
determine.
95. Each Director shall be entitled to be repaid
or prepaid all travelling, hotel and incidental expenses reasonably incurred or expected to be incurred by him in attending meetings of
the Board or committees of the Board or general meetings or separate meetings of any class of shares or of debentures of the Company or
otherwise in connection with the discharge of his duties as a Director.
96. Any Director who, by request, goes or
resides abroad for any purpose of the Company or who performs services which in the opinion of the Board go beyond the ordinary
duties of a Director may be paid such extra remuneration (whether by way of salary, commission, participation in profits or
otherwise) as the Board may determine and such extra remuneration shall be in addition to or in substitution for any ordinary
remuneration provided for by or pursuant to any other Article.
97. Subject to the Designated Exchange Rules,
the Board may, without the approval of the Members in a general meeting, make payments to any Director or past Director of the Company
by way of compensation for loss of office, or as consideration for or in connection with his retirement from office (not being payment
to which the Director is contractually entitled).
DIRECTORS’ INTERESTS
98. A Director may:
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(a)
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hold any other office or place of profit with the Company (except that of Auditor) in conjunction with
his office of Director for such period and upon such terms as the Board may determine. Any remuneration (whether by way of salary, commission,
participation in profits or otherwise) paid to any Director in respect of any such other office or place of profit shall be in addition
to any remuneration provided for by or pursuant to any other Article;
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(b)
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act by himself or his firm in a professional capacity for the Company (otherwise than as Auditor) and
he or his firm may be remunerated for professional services as if he were not a Director;
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(c)
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continue to be or become a director, or other officer or member of any other company promoted by the Company
or in which the Company may be interested as a vendor, shareholder or otherwise and (unless otherwise agreed) no such Director shall be
accountable for any remuneration, profits or other benefits received by him as a director, or other officer or member of or from his interests
in any such other company. Subject as otherwise provided by these Articles the Directors may exercise or cause to be exercised the voting
powers conferred by the shares in any other company held or owned by the Company, or exercisable by them as Directors of such other company
in such manner in all respects as they think fit (including the exercise thereof in favour of any resolution appointing themselves or
any of them directors, or other officers of such company) or voting or providing for the payment of remuneration to the director, or other
officers of such other company and any Director may vote in favour of the exercise of such voting rights in manner aforesaid notwithstanding
that he may be, or about to be, appointed a director, or other officer of such a company, and that as such he is or may become interested
in the exercise of such voting rights in manner aforesaid.
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Notwithstanding the foregoing,
no “Independent Director” as defined in Designated Stock Exchange Rules or in Rule 10A-3 under the Exchange Act, and with
respect of whom the Board has determined constitutes an “Independent Director” for purposes of compliance with applicable
law or the Company’s listing requirements, shall without the consent of the Audit Committee take any of the foregoing actions or
any other action that would reasonably be likely to affect such Director’s status as an “Independent Director” of the
Company.
99. Subject to the Act and to these Articles,
no Director or proposed or intending Director shall be disqualified by his office from contracting with the Company, either with regard
to his tenure of any office or place of profit or as vendor, purchaser or in any other manner whatever, nor shall any such contract or
any other contract or arrangement in which any Director is in any way interested be liable to be avoided, nor shall any Director so contracting
or being so interested be liable to account to the Company or the Members for any remuneration, profit or other benefits realised by any
such contract or arrangement by reason of such Director holding that office or of the fiduciary relationship thereby established provided
that such Director shall disclose the nature of his interest in any contract or arrangement in which he is interested in accordance with
Article 100 herein. Any such transaction that would reasonably be likely to affect a Director’s
status as an “Independent Director”, or that would constitute a “related party transaction” as defined by Item
7.B of Form 20-F promulgated by the SEC, shall require the approval of the Audit Committee.
100. A Director who to his knowledge is in
any way, whether directly or indirectly, interested in a contract or arrangement or proposed contract or arrangement with the Company
shall declare the nature of his interest at the meeting of the Board at which the question of entering into the contract or arrangement
is first considered, if he knows his interest then exists, or in any other case at the first meeting of the Board after he knows that
he is or has become so interested. For the purposes of this Article, a general Notice to the Board by a Director to the effect that:
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(a)
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he is a member or officer of a specified company or firm and is to be regarded as interested in any contract
or arrangement which may after the date of the Notice be made with that company or firm; or
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(b)
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he is to be regarded as interested in any contract or arrangement which may after the date of the Notice
be made with a specified person who is connected with him;
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shall be deemed to be a sufficient
declaration of interest under this Article in relation to any such contract or arrangement, provided that no such Notice shall be effective
unless either it is given at a meeting of the Board or the Director takes reasonable steps to secure that it is brought up and read at
the next Board meeting after it is given.
101. Following a declaration being made pursuant
to the last preceding two Articles, subject to any separate requirement for Audit Committee approval under applicable law or the listing
rules of the Company’s Designated Stock Exchange, and unless disqualified by the chairman of the relevant Board meeting, a Director
may vote in respect of any contract or proposed contract or arrangement in which such Director is interested and may be counted in the
quorum at such meeting.
GENERAL POWERS OF THE DIRECTORS
102. (1) The business of the Company shall
be managed and conducted by the Board, which may pay all expenses incurred in forming and registering the Company and may exercise all
powers of the Company (whether relating to the management of the business of the Company or otherwise) which are not by the Statutes or
by these Articles required to be exercised by the Members in general meeting, subject nevertheless to the provisions of the Statutes and
of these Articles and to such regulations being not inconsistent with such provisions, as may be prescribed by the Members in a general
meeting, but no regulations made by the Members in a general meeting shall invalidate any prior act of the Board which would have been
valid if such regulations had not been made. The general powers given by this Article shall not be limited or restricted by any special
authority or power given to the Board by any other Article.
(2) Any
person contracting or dealing with the Company in the ordinary course of business shall be entitled to rely on any written or oral contract
or agreement or deed, document or instrument entered into or executed as the case may be by any two of the Directors acting jointly on
behalf of the Company and the same shall be deemed to be validly entered into or executed by the Company as the case may be and shall,
subject to any rule of law, be binding on the Company.
(3) Without
prejudice to the general powers conferred by these Articles it is hereby expressly declared that the Board shall have the following powers:
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(a)
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To give to any person the right or option of requiring at a future date that an allotment shall be made
to him of any share at par or at such premium as may be agreed.
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(b)
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To give to any Directors, officers or employees of the Company an interest in any particular business
or transaction or participation in the profits thereof or in the general profits of the Company either in addition to or in substitution
for a salary or other remuneration.
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(c)
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To resolve that the Company be deregistered in the Cayman Islands and continued in a named jurisdiction
outside the Cayman Islands subject to the provisions of the Act.
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103. The Board may establish any regional or
local boards or agencies for managing any of the affairs of the Company in any place, and may appoint any persons to be members of such
local boards, or any managers or agents, and may fix their remuneration (either by way of salary or by commission or by conferring the
right to participation in the profits of the Company or by a combination of two or more of these modes) and pay the working expenses of
any staff employed by them upon the business of the Company. The Board may delegate to any regional or local board, manager or agent any
of the powers, authorities and discretions vested in or exercisable by the Board (other than its powers to make calls and forfeit shares),
with power to sub-delegate, and may authorise the members of any of them to fill any vacancies therein and to act notwithstanding vacancies.
Any such appointment or delegation may be made upon such terms and subject to such conditions as the Board may think fit, and the Board
may remove any person appointed as aforesaid, and may revoke or vary such delegation, but no person dealing in good faith and without
notice of any such revocation or variation shall be affected thereby.
104. The Board may by power of attorney appoint
any company, firm or person or any fluctuating body of persons, whether nominated directly or indirectly by the Board, to be the attorney
or attorneys of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable
by the Board under these Articles) and for such period and subject to such conditions as it may think fit, and any such power of attorney
may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board may think fit, and
may also authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions vested in him. Such attorney
or attorneys may, if so authorised under the Seal of the Company, execute any deed or instrument under their personal seal with the same
effect as the affixation of the Company’s Seal.
105. The Board may entrust to and confer upon
any Director any of the powers exercisable by it upon such terms and conditions and with such restrictions as it thinks fit, and either
collaterally with, or to the exclusion of, its own powers, and may from time to time revoke or vary all or any of such powers but no person
dealing in good faith and without notice of such revocation or variation shall be affected thereby.
106. All cheques, promissory notes, drafts,
bills of exchange and other instruments, whether negotiable or transferable or not, and all receipts for moneys paid to the Company shall
be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as the Board shall from time to time by
resolution determine. The Company’s banking accounts shall be kept with such banker or bankers as the Board shall from time to time
determine.
107. (1) The Board may establish or concur
or join with other companies (being subsidiary companies of the Company or companies with which it is associated in business) in establishing
and making contributions out of the Company’s moneys to any schemes or funds for providing pensions, sickness or compassionate allowances,
life assurance or other benefits for employees (which expression as used in this and the following paragraph shall include any Director
or ex-Director who may hold or have held any executive office or any office of profit under the Company or any of its subsidiary companies)
and ex-employees of the Company and their dependants or any class or classes of such person.
(2) The
Board may pay, enter into agreements to pay or make grants of revocable or irrevocable pensions or other benefits to employees and ex-employees
and their dependants, or to any of such persons, including pensions or benefits additional to those, if any, to which such employees or
ex-employees or their dependants are or may become entitled under any such scheme or fund as mentioned in the last preceding paragraph.
Any such pension or benefit may, as the Board considers desirable, be granted to an employee either before and in anticipation of or upon
or at any time after his actual retirement, and may be subject or not subject to any terms or conditions as the Board may determine.
BORROWING POWERS
108. The Board may exercise all the powers
of the Company to raise or borrow money and to mortgage or charge all or any part of the undertaking, property and assets (present and
future) and uncalled capital of the Company and, subject to the Act, to issue debentures, bonds and other securities, whether outright
or as collateral security for any debt, liability or obligation of the Company or of any third party.
109. Debentures, bonds and other securities
may be made assignable free from any equities between the Company and the person to whom the same may be issued.
110. Any debentures, bonds or other securities
may be issued at a discount (other than shares), premium or otherwise and with any special privileges as to redemption, surrender, drawings,
allotment of shares, attending and voting at general meetings of the Company, appointment of Directors and otherwise.
111. (1) Where any uncalled capital of the
Company is charged, all persons taking any subsequent charge thereon shall take the same subject to such prior charge, and shall not be
entitled, by notice to the Members or otherwise, to obtain priority over such prior charge.
(2) The
Board shall cause a proper register to be kept, in accordance with the provisions of the Act, of all charges specifically affecting the
property of the Company and of any series of debentures issued by the Company and shall duly comply with the requirements of the Act in
regard to the registration of charges and debentures therein specified and otherwise.
PROCEEDINGS OF THE DIRECTORS
112. The Board may meet for the despatch of
business, adjourn and otherwise regulate its meetings as it considers appropriate. Questions arising at any meeting shall be determined
by a majority of votes. In the case of any equality of votes the chairman of the meeting shall have an additional or casting vote.
113. A meeting of the Board may be convened
by the Secretary on request of a Director or by any Director. The Secretary shall convene a meeting of the Board of which notice may be
given in writing or by telephone or in such other manner as the Board may from time to time determine whenever he shall be required so
to do by the chief executive officer or chairman, as the case may be, or any Director.
114. (1) The quorum necessary for the transaction
of the business of the Board may be fixed by the Board and, unless so fixed at any other number, shall be a majority of the Directors
then in office, and which shall include the Chairman. An alternate Director shall be counted in a quorum in the case of the absence of
a Director for whom he is the alternate provided that he shall not be counted more than once for the purpose of determining whether or
not a quorum is present.
(2) Directors
may participate in any meeting of the Board by means of a conference telephone or other communications equipment through which all persons
participating in the meeting can communicate with each other simultaneously and instantaneously and, for the purpose of counting a quorum,
such participation shall constitute presence at a meeting as if those participating were present in person.
(3) Any
Director who ceases to be a Director at a Board meeting may continue to be present and to act as a Director and be counted in the quorum
until the termination of such Board meeting if no other Director objects and if otherwise a quorum of Directors would not be present.
115. The continuing Directors or a sole continuing
Director may act notwithstanding any vacancy in the Board but, if and so long as the number of Directors is reduced below the minimum
number fixed by or in accordance with these Articles, the continuing Directors or Director, notwithstanding that the number of Directors
is below the number fixed by or in accordance with these Articles as the quorum or that there is only one continuing Director, may act
for the purpose of filling vacancies in the Board or of summoning general meetings of the Company but not for any other purpose.
116. The Chairman of the Board shall be the
chairman of all meetings of the Board. If the Chairman of the Board is not present at any meeting within five (5) minutes after the time
appointed for holding the same, the Directors present may choose one of their number to be chairman of the meeting.
117. A meeting of the Board at which a quorum
is present shall be competent to exercise all the powers, authorities and discretions for the time being vested in or exercisable by the
Board.
118. (1) The Board may delegate any of its
powers, authorities and discretions to committees (including, without limitation, the Audit Committee), consisting of such Director or
Directors and other persons as it thinks fit, and they may, from time to time, revoke such delegation or revoke the appointment of and
discharge any such committees either wholly or in part, and either as to persons or purposes. Any committee so formed shall, in the exercise
of the powers, authorities and discretions so delegated, conform to any regulations which may be imposed on it by the Board.
(2) All
acts done by any such committee in conformity with such regulations, and in fulfilment of the purposes for which it was appointed, but
not otherwise, shall have like force and effect as if done by the Board, and the Board (or if the Board delegates such power, the committee)
shall have power to remunerate the members of any such committee, and charge such remuneration to the current expenses of the Company.
119. The meetings and proceedings of any committee
consisting of two or more members shall be governed by the provisions contained in these Articles for regulating the meetings and proceedings
of the Board so far as the same are applicable and are not superseded by any regulations imposed by the Board under the last preceding
Article, indicating, without limitation, any committee charter adopted by the Board for purposes or in respect of any such committee.
120. A resolution in writing signed by all
the Directors except such as are temporarily unable to act through ill-health or disability shall (provided that such number is sufficient
to constitute a quorum and further provided that a copy of such resolution has been given or the contents thereof communicated to all
the Directors for the time being entitled to receive notices of Board meetings in the same manner as notices of meetings are required
to be given by these Articles) be as valid and effectual as if a resolution had been passed at a meeting of the Board duly convened and
held. Such resolution may be contained in one document or in several documents in like form each signed by one or more of the Directors
and for this purpose a facsimile signature of a Director shall be treated as valid.
121. All acts bona fide done by the Board or
by any committee or by any person acting as a Director or members of a committee, shall, notwithstanding that it is afterwards discovered
that there was some defect in the appointment of any member of the Board or such committee or person acting as aforesaid or that they
or any of them were disqualified or had vacated office, be as valid as if every such person had been duly appointed and was qualified
and had continued to be a Director or member of such committee.
AUDIT COMMITTEE
122. Without prejudice to the freedom of the
Directors to establish any other committees, for so long as the shares of the Company (or depositary receipts therefor) are listed or
quoted on the Designated Stock Exchange, the Board shall establish and maintain an Audit Committee as a committee of the Board, the composition
and responsibilities of which shall comply with the Designated Stock Exchange Rules and the rules and regulations of the SEC.
123. (1) The Board shall adopt a formal
written audit committee charter and review and assess the adequacy of the formal written charter on an annual basis.
(2) The
Audit Committee shall meet at least once every financial quarter, or more frequently as circumstances dictate.
124. For so long as the shares of the Company
(or depositary receipts therefor) are listed or quoted on the Designated Stock Exchange, the Company shall conduct an appropriate review
of all related party transactions on an ongoing basis and shall utilize the Audit Committee for the review and approval of potential conflicts
of interest. Specially, the Audit Committee shall approve any transaction or transactions between the Company and any of the following
parties: (i) any shareholder owning an interest in the voting power of the Company or any subsidiary of the Company that gives such shareholder
significant influence over the Company or any subsidiary of the Company, (ii) any director or executive officer of the Company or any
subsidiary of the Company and any relative of such director or executive officer, (iii) any person in which a substantial interest in
the voting power of the Company is owned, directly or indirectly, by any person described in (i) or (ii) or over which such a person is
able to exercise significant influence, and (iv) any affiliate (other than a subsidiary) of the Company.
OFFICERS
125. (1) The officers of the Company shall
consist of the Chairman of the Board, the Directors and Secretary and such additional officers (who may or may not be Directors) as the
Board may from time to time determine, all of whom shall be deemed to be officers for the purposes of the Act and these Articles.
(2) The
Directors shall elect, by a majority of the Directors then in office, amongst the Directors the Chairman of the Board..
(3) The
officers shall receive such remuneration as the Directors may from time to time determine.
126. (1) The Secretary and additional officers,
if any, shall be appointed by the Board and shall hold office on such terms and for such period as the Board may determine. If thought
fit, two or more persons may be appointed as joint Secretaries. The Board may also appoint from time to time on such terms as it thinks
fit one or more assistant or deputy Secretaries.
(2) The
Secretary shall attend all meetings of the Members and shall keep correct minutes of such meetings and enter the same in the proper books
provided for the purpose. He shall perform such other duties as are prescribed by the Act or these Articles or as may be prescribed by
the Board.
127. The officers of the Company shall have
such powers and perform such duties in the management, business and affairs of the Company as may be delegated to them by the Directors
from time to time.
128. A provision of the Act or of these Articles
requiring or authorising a thing to be done by or to a Director and the Secretary shall not be satisfied by its being done by or to the
same person acting both as Director and as or in place of the Secretary.
REGISTER OF DIRECTORS AND OFFICERS
129. The Company shall cause to be kept in
one or more books at its Office a Register of Directors and Officers in which there shall be entered the full names and addresses of the
Directors and Officers and such other particulars as required by the Act or as the Directors may determine. The Company shall send to
the Registrar of Companies in the Cayman Islands a copy of such register, and shall from time to time notify to the said Registrar of
any change that takes place in relation to such Directors and Officers as required by the Act.
MINUTES
130. (1) The Board shall cause minutes to
be duly entered in books provided for the purpose:
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(a)
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of all elections and appointments of officers;
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(b)
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of the names of the Directors present at each meeting of the Directors and of any committee of the Directors;
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(c)
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of all resolutions and proceedings of each general meeting of the Members, meetings of the Board and meetings
of committees of the Board and where there are managers, of all proceedings of meetings of the managers.
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(2)
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Minutes shall be kept by the Secretary at the Office.
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SEAL
131. (1) The Company shall have one or more
Seals, as the Board may determine. For the purpose of sealing documents creating or evidencing securities issued by the Company, the Company
may have a securities seal which is a facsimile of the Seal of the Company with the addition of the word “Securities” on its
face or in such other form as the Board may approve. The Board shall provide for the custody of each Seal and no Seal shall be used without
the authority of the Board or of a committee of the Board authorised by the Board in that behalf. Subject as otherwise provided in these
Articles, any instrument to which a Seal is affixed shall be signed autographically by one Director and the Secretary or by two Directors
or by such other person (including a Director) or persons as the Board may appoint, either generally or in any particular case, save that
as regards any certificates for shares or debentures or other securities of the Company the Board may by resolution determine that such
signatures or either of them shall be dispensed with or affixed by some method or system of mechanical signature. Every instrument executed
in manner provided by this Article shall be deemed to be sealed and executed with the authority of the Board previously given.
(2) Where
the Company has a Seal for use abroad, the Board may by writing under the Seal appoint any agent or committee abroad to be the duly authorised
agent of the Company for the purpose of affixing and using such Seal and the Board may impose restrictions on the use thereof as may be
thought fit. Wherever in these Articles reference is made to the Seal, the reference shall, when and so far as may be applicable, be deemed
to include any such other Seal as aforesaid.
AUTHENTICATION OF DOCUMENTS
132. Any Director or the Secretary or any person
appointed by the Board for the purpose may authenticate any documents affecting the constitution of the Company and any resolution passed
by the Company or the Board or any committee thereof, and any books, records, documents and accounts relating to the business of the Company,
and to certify copies thereof or extracts therefrom as true copies or extracts, and if any books, records, documents or accounts are elsewhere
than at the Office or the head office the local manager or other officer of the Company having the custody thereof shall be deemed to
be a person so appointed by the Board. A document purporting to be a copy of a resolution, or an extract from the minutes of a meeting,
of the Company or of the Board or any committee thereof which is so certified shall be conclusive evidence in favour of all persons dealing
with the Company upon the faith thereof that such resolution has been duly passed or, as the case may be, that such minutes or extract
is a true and accurate record of proceedings at a duly constituted meeting.
DESTRUCTION OF DOCUMENTS
133. (1) The Company shall be entitled to
destroy the following documents at the following times:
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(a)
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any share certificate which has been cancelled at any time after the expiry of one (1) year from the date
of such cancellation;
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(b)
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any dividend mandate or any variation or cancellation thereof or any notification of change of name or
address at any time after the expiry of two (2) years from the date such mandate variation cancellation or notification was recorded by
the Company;
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(c)
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any instrument of transfer of shares which has been registered at any time after the expiry of seven (7)
years from the date of registration;
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(d)
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any allotment letters after the expiry of seven (7) years from the date of issue thereof; and
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(e)
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copies of powers of attorney, grants of probate and letters of administration at any time after the expiry
of seven (7) years after the account to which the relevant power of attorney, grant of probate or letters of administration related has
been closed;
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and it shall conclusively be
presumed in favour of the Company that every entry in the Register purporting to be made on the basis of any such documents so destroyed
was duly and properly made and every share certificate so destroyed was a valid certificate duly and properly cancelled and that every
instrument of transfer so destroyed was a valid and effective instrument duly and properly registered and that every other document destroyed
hereunder was a valid and effective document in accordance with the recorded particulars thereof in the books or records of the Company.
Provided always that: (1) the foregoing provisions of this Article shall apply only to the destruction of a document in good faith and
without express notice to the Company that the preservation of such document was relevant to a claim; (2) nothing contained in this Article
shall be construed as imposing upon the Company any liability in respect of the destruction of any such document earlier than as aforesaid
or in any case where the conditions of proviso (1) above are not fulfilled; and (3) references in this Article to the destruction of any
document include references to its disposal in any manner.
(2) Notwithstanding
any provision contained in these Articles, the Directors may, if permitted by applicable law, authorise the destruction of documents set
out in sub-paragraphs (a) to (e) of paragraph (1) of this Article and any other documents in relation to share registration which have
been microfilmed or electronically stored by the Company or by the share registrar on its behalf provided always that this Article shall
apply only to the destruction of a document in good faith and without express notice to the Company and its share registrar that the preservation
of such document was relevant to a claim.
DIVIDENDS AND OTHER PAYMENTS
134. Subject to the Act, the Board may from
time to time declare dividends in any currency to be paid to the Members.
135. Dividends may be declared and paid out
of the profits of the Company, realised or unrealised, or from any reserve set aside from profits which the Directors determine is no
longer needed. The Board may also declare and pay dividends out of share premium account or any other fund or account which can be authorised
for this purpose in accordance with the Act.
136. Except in so far as the rights attaching
to, or the terms of issue of, any share otherwise provide:
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(a)
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all dividends shall be declared and paid according to the amounts paid up on the shares in respect of
which the dividend is paid, but no amount paid up on a share in advance of calls shall be treated for the purposes of this Article as
paid up on the share; and
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(b)
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all dividends shall be apportioned and paid pro rata according to the amounts paid up on the shares during
any portion or portions of the period in respect of which the dividend is paid.
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137. The Board may from time to time pay to
the Members such interim dividends as appear to the Board to be justified by the profits of the Company and in particular (but without
prejudice to the generality of the foregoing) if at any time the share capital of the Company is divided into different classes, the Board
may pay such interim dividends in respect of those shares in the capital of the Company which confer on the holders thereof deferred or
non-preferential rights as well as in respect of those shares which confer on the holders thereof preferential rights with regard to dividend
and may also pay any fixed dividend which is payable on any shares of the Company half-yearly or on any other dates, whenever such profits,
in the opinion of the Board, justifies such payment; provided that the Board acts bona fide the Board shall not incur any responsibility
to the holders of shares conferring any preference for any damage that they may suffer by reason of the payment of an interim dividend
on any shares having deferred or non-preferential rights.
138. The Board may deduct from any dividend
or other moneys payable to a Member by the Company on or in respect of any shares all sums of money (if any) presently payable by him
to the Company on account of calls or otherwise.
139. No dividend or other moneys payable by
the Company on or in respect of any share shall bear interest against the Company.
140. Any dividend, interest or other sum payable
in cash to the holder of shares may be paid by cheque or warrant sent through the post addressed to the holder at his registered address
or, in the case of joint holders, addressed to the holder whose name stands first in the Register in respect of the shares at his address
as appearing in the Register or addressed to such person and at such address as the holder or joint holders may in writing direct. Every
such cheque or warrant shall, unless the holder or joint holders otherwise direct, be made payable to the order of the holder or, in the
case of joint holders, to the order of the holder whose name stands first on the Register in respect of such shares, and shall be sent
at his or their risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to the Company
notwithstanding that it may subsequently appear that the same has been stolen or that any endorsement thereon has been forged. Any one
of two or more joint holders may give effectual receipts for any dividends or other moneys payable or property distributable in respect
of the shares held by such joint holders.
141. All dividends or bonuses unclaimed for
one (1) year after having been declared may be invested or otherwise made use of by the Board for the benefit of the Company until claimed.
Any dividend or bonuses unclaimed after a period of six (6) years from the date of declaration shall be forfeited and shall revert to
the Company. The payment by the Board of any unclaimed dividend or other sums payable on or in respect of a share into a separate account
shall not constitute the Company a trustee in respect thereof.
142. Whenever the Board has resolved that a
dividend be paid or declared, the Board may further resolve that such dividend be satisfied wholly or in part by the distribution of specific
assets of any kind and in particular of paid up shares, debentures or warrants to subscribe securities of the Company or any other company,
or in any one or more of such ways, and where any difficulty arises in regard to the distribution the Board may settle the same as it
thinks expedient, and in particular may issue certificates in respect of fractions of shares, disregard fractional entitlements or round
the same up or down, and may fix the value for distribution of such specific assets, or any part thereof, and may determine that cash
payments shall be made to any Members upon the footing of the value so fixed in order to adjust the rights of all parties, and may vest
any such specific assets in trustees as may seem expedient to the Board and may appoint any person to sign any requisite instruments of
transfer and other documents on behalf of the persons entitled to the dividend, and such appointment shall be effective and binding on
the Members. The Board may resolve that no such assets shall be made available to Members with registered addresses in any particular
territory or territories where, in the absence of a registration statement or other special formalities, such distribution of assets would
or might, in the opinion of the Board, be unlawful or impracticable and in such event the only entitlement of the Members aforesaid shall
be to receive cash payments as aforesaid. Members affected as a result of the foregoing sentence shall not be or be deemed to be a separate
class of Members for any purpose whatsoever.
143. (1) Whenever the Board has resolved
that a dividend be paid or declared on any class of the share capital of the Company, the Board may further resolve either:
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(a)
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that such dividend be satisfied wholly or in part in the form of an allotment of shares credited as fully
paid up, provided that the Members entitled thereto will be entitled to elect to receive such dividend (or part thereof if the Board so
determines) in cash in lieu of such allotment. In such case, the following provisions shall apply:
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(i)
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the basis of any such allotment shall be determined by the Board;
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(ii)
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the Board, after determining the basis of allotment, shall give not less than ten (10) days’ Notice
to the holders of the relevant shares of the right of election accorded to them and shall send with such notice forms of election and
specify the procedure to be followed and the place at which and the latest date and time by which duly completed forms of election must
be lodged in order to be effective;
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(iii)
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the right of election may be exercised in respect of the whole or part of that portion of the dividend
in respect of which the right of election has been accorded; and
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(iv)
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the dividend (or that part of the dividend to be satisfied by the allotment of shares as aforesaid) shall
not be payable in cash on shares in respect whereof the cash election has not been duly exercised (“the non-elected shares”)
and in satisfaction thereof shares of the relevant class shall be allotted credited as fully paid up to the holders of the non-elected
shares on the basis of allotment determined as aforesaid and for such purpose the Board shall capitalise and apply out of any part of
the undivided profits of the Company (including profits carried and standing to the credit of any reserves or other special account, share
premium account, capital redemption reserve other than the Subscription Rights Reserve) as the Board may determine, such sum as may be
required to pay up in full the appropriate number of shares of the relevant class for allotment and distribution to and amongst the holders
of the non-elected shares on such basis; or
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(b)
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that the Members entitled to such dividend shall be entitled to elect to receive an allotment of shares
credited as fully paid up in lieu of the whole or such part of the dividend as the Board may think fit. In such case, the following provisions
shall apply:
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(i)
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the basis of any such allotment shall be determined by the Board;
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(ii)
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the Board, after determining the basis of allotment, shall give not less than ten (10) days’ Notice
to the holders of the relevant shares of the right of election accorded to them and shall send with such notice forms of election and
specify the procedure to be followed and the place at which and the latest date and time by which duly completed forms of election must
be lodged in order to be effective;
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(iii)
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the right of election may be exercised in respect of the whole or part of that portion of the dividend
in respect of which the right of election has been accorded; and
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(iv)
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the dividend (or that part of the dividend in respect of which a right of election has been accorded) shall
not be payable in cash on shares in respect whereof the share election has been duly exercised (“the elected shares”) and
in satisfaction thereof shares of the relevant class shall be allotted credited as fully paid up to the holders of the elected shares
on the basis of allotment determined as aforesaid and for such purpose the Board shall capitalise and apply out of any part of the undivided
profits of the Company (including profits carried and standing to the credit of any reserves or other special account, share premium account,
capital redemption reserve other than the Subscription Rights Reserve) as the Board may determine, such sum as may be required to pay
up in full the appropriate number of shares of the relevant class for allotment and distribution to and amongst the holders of the elected
shares on such basis.
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(2)
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(a)
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The shares allotted pursuant to the provisions of paragraph (1) of this Article shall rank pari
passu in all respects with shares of the same class (if any) then in issue save only as regards participation in the relevant dividend
or in any other distributions, bonuses or rights paid, made, declared or announced prior to or contemporaneously with the payment or declaration
of the relevant dividend unless, contemporaneously with the announcement by the Board of their proposal to apply the provisions of sub-paragraph
(a) or (b) of paragraph (2) of this Article in relation to the relevant dividend or contemporaneously with their announcement of the distribution,
bonus or rights in question, the Board shall specify that the shares to be allotted pursuant to the provisions of paragraph (1) of this
Article shall rank for participation in such distribution, bonus or rights.
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(b)
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The Board may do all acts and things considered necessary or expedient to give effect to any capitalisation
pursuant to the provisions of paragraph (1) of this Article, with full power to the Board to make such provisions as it thinks fit in
the case of shares becoming distributable in fractions (including provisions whereby, in whole or in part, fractional entitlements are
aggregated and sold and the net proceeds distributed to those entitled, or are disregarded or rounded up or down or whereby the benefit
of fractional entitlements accrues to the Company rather than to the Members concerned). The Board may authorise any person to enter into
on behalf of all Members interested, an agreement with the Company providing for such capitalisation and matters incidental thereto and
any agreement made pursuant to such authority shall be effective and binding on all concerned.
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(3) The
Board may by ordinary resolution resolve in respect of any one particular dividend of the Company that notwithstanding the provisions
of paragraph (1) of this Article a dividend may be satisfied wholly in the form of an allotment of shares credited as fully paid up without
offering any right to shareholders to elect to receive such dividend in cash in lieu of such allotment.
(4) The
Board may on any occasion determine that rights of election and the allotment of shares under paragraph (1) of this Article shall not
be made available or made to any shareholders with registered addresses in any territory where, in the absence of a registration statement
or other special formalities, the circulation of an offer of such rights of election or the allotment of shares would or might, in the
opinion of the Board, be unlawful or impracticable, and in such event the provisions aforesaid shall be read and construed subject to
such determination. Members affected as a result of the foregoing sentence shall not be or be deemed to be a separate class of Members
for any purpose whatsoever.
(5) Any
resolution of the Board declaring a dividend on shares of any class may specify that the same shall be payable or distributable to the
persons registered as the holders of such shares at the close of business on a particular date, notwithstanding that it may be a date
prior to that on which the resolution is passed, and thereupon the dividend shall be payable or distributable to them in accordance with
their respective holdings so registered, but without prejudice to the rights inter se in respect of such dividend of transferors and transferees
of any such shares. The provisions of this Article shall mutatis mutandis apply to bonuses, capitalisation issues, distributions of realised
capital profits or offers or grants made by the Company to the Members.
RESERVES
144. (1) The Board shall establish an account
to be called the share premium account and shall carry to the credit of such account from time to time a sum equal to the amount or value
of the premium paid on the issue of any share in the Company. Unless otherwise provided by the provisions of these Articles, the Board
may apply the share premium account in any manner permitted by the Act. The Company shall at all times comply with the provisions of the
Act in relation to the share premium account.
(2) Before
recommending any dividend, the Board may set aside out of the profits of the Company such sums as it determines as reserves which shall,
at the discretion of the Board, be applicable for any purpose to which the profits of the Company may be properly applied and pending
such application may, also at such discretion, either be employed in the business of the Company or be invested in such investments as
the Board may from time to time think fit and so that it shall not be necessary to keep any investments constituting the reserve or reserves
separate or distinct from any other investments of the Company. The Board may also without placing the same to reserve carry forward any
profits which it may think prudent not to distribute.
CAPITALISATION
145. The Board may, at any time and from time
to time, pass a resolution to the effect that it is desirable to capitalise all or any part of any amount for the time being standing
to the credit of any reserve or fund (including a share premium account and capital redemption reserve and the profit and loss account)
whether or not the same is available for distribution and accordingly that such amount be set free for distribution among the Members
or any class of Members who would be entitled thereto if it were distributed by way of dividend and in the same proportions, on the footing
that the same is not paid in cash but is applied either in or towards paying up the amounts for the time being unpaid on any shares in
the Company held by such Members respectively or in paying up in full unissued shares, debentures or other obligations of the Company,
to be allotted and distributed credited as fully paid up among such Members, or partly in one way and partly in the other, and the Board
shall give effect to such resolution provided that, for the purposes of this Article, a share premium account and any capital redemption
reserve or fund representing unrealised profits, may be applied only in paying up in full unissued shares of the Company to be allotted
to such Members credited as fully paid.
146. The Board may settle, as it considers
appropriate, any difficulty arising in regard to any distribution under the last preceding Article and in particular may issue certificates
in respect of fractions of shares or authorise any person to sell and transfer any fractions or may resolve that the distribution should
be as nearly as may be practicable in the correct proportion but not exactly so or may ignore fractions altogether, and may determine
that cash payments shall be made to any Members in order to adjust the rights of all parties, as may seem expedient to the Board. The
Board may appoint any person to sign on behalf of the persons entitled to participate in the distribution any contract necessary or desirable
for giving effect thereto and such appointment shall be effective and binding upon the Members.
SUBSCRIPTION RIGHTS RESERVE
147. The following provisions shall have effect
to the extent that they are not prohibited by and are in compliance with the Act:
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(1)
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If, so long as any of the rights attached to any warrants issued by the Company to subscribe for shares
of the Company shall remain exercisable, the Company does any act or engages in any transaction which, as a result of any adjustments
to the subscription price in accordance with the provisions of the conditions of the warrants, would reduce the subscription price to
below the par value of a share, then the following provisions shall apply:
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(a)
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as from the date of such act or transaction the Company shall establish and thereafter (subject as provided
in this Article) maintain in accordance with the provisions of this Article a reserve (the “Subscription Rights Reserve”)
the amount of which shall at no time be less than the sum which for the time being would be required to be capitalised and applied in
paying up in full the nominal amount of the additional shares required to be issued and allotted credited as fully paid pursuant to sub-paragraph
(c) below on the exercise in full of all the subscription rights outstanding and shall apply the Subscription Rights Reserve in paying
up such additional shares in full as and when the same are allotted;
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(b)
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the Subscription Rights Reserve shall not be used for any purpose other than that specified above unless
all other reserves of the Company (other than share premium account) have been extinguished and will then only be used to make good losses
of the Company if and so far as is required by law;
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(c)
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upon the exercise of all or any of the subscription rights represented by any warrant, the relevant subscription
rights shall be exercisable in respect of a nominal amount of shares equal to the amount in cash which the holder of such warrant is required
to pay on exercise of the subscription rights represented thereby (or, as the case may be the relevant portion thereof in the event of
a partial exercise of the subscription rights) and, in addition, there shall be allotted in respect of such subscription rights to the
exercising warrantholder, credited as fully paid, such additional nominal amount of shares as is equal to the difference between:
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(i)
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the said amount in cash which the holder of such warrant is required to pay on exercise of the subscription
rights represented thereby (or, as the case may be, the relevant portion thereof in the event of a partial exercise of the subscription
rights); and
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(ii)
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the nominal amount of shares in respect of which such subscription rights would have been exercisable
having regard to the provisions of the conditions of the warrants, had it been possible for such subscription rights to represent the
right to subscribe for shares at less than par and immediately upon such exercise so much of the sum standing to the credit of the Subscription
Rights Reserve as is required to pay up in full such additional nominal amount of shares shall be capitalised and applied in paying up
in full such additional nominal amount of shares which shall forthwith be allotted credited as fully paid to the exercising warrantholders;
and
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(d)
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if, upon the exercise of the subscription rights represented by any warrant, the amount standing to the
credit of the Subscription Rights Reserve is not sufficient to pay up in full such additional nominal amount of shares equal to such difference
as aforesaid to which the exercising warrantholder is entitled, the Board shall apply any profits or reserves then or thereafter becoming
available (including, to the extent permitted by law, share premium account) for such purpose until such additional nominal amount of
shares is paid up and allotted as aforesaid and until then no dividend or other distribution shall be paid or made on the fully paid shares
of the Company then in issue. Pending such payment and allotment, the exercising warrantholder shall be issued by the Company with a certificate
evidencing his right to the allotment of such additional nominal amount of shares. The rights represented by any such certificate shall
be in registered form and shall be transferable in whole or in part in units of one share in the like manner as the shares for the time
being are transferable, and the Company shall make such arrangements in relation to the maintenance of a register therefor and other matters
in relation thereto as the Board may think fit and adequate particulars thereof shall be made known to each relevant exercising warrantholder
upon the issue of such certificate.
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(2) Shares
allotted pursuant to the provisions of this Article shall rank pari passu in all respects with the other shares allotted on the relevant
exercise of the subscription rights represented by the warrant concerned. Notwithstanding anything contained in paragraph (1) of this
Article, no fraction of any share shall be allotted on exercise of the subscription rights.
(3) The
provision of this Article as to the establishment and maintenance of the Subscription Rights Reserve shall not be altered or added to
in any way which would vary or abrogate, or which would have the effect of varying or abrogating the provisions for the benefit of any
warrantholder or class of warrantholders under this Article without the sanction of a special resolution of such warrantholders or class
of warrantholders.
(4) A
certificate or report by the auditors for the time being of the Company as to whether or not the Subscription Rights Reserve is required
to be established and maintained and if so the amount thereof so required to be established and maintained, as to the purposes for which
the Subscription Rights Reserve has been used, as to the extent to which it has been used to make good losses of the Company, as to the
additional nominal amount of shares required to be allotted to exercising warrantholders credited as fully paid, and as to any other matter
concerning the Subscription Rights Reserve shall (in the absence of manifest error) be conclusive and binding upon the Company and all
warrantholders and shareholders.
ACCOUNTING RECORDS
148. The Board shall cause true accounts to
be kept of the sums of money received and expended by the Company, and the matters in respect of which such receipt and expenditure take
place, and of the property, assets, credits and liabilities of the Company and of all other matters required by the Act or necessary to
give a true and fair view of the Company’s affairs and to explain its transactions.
149. The accounting records shall be kept at
the Office or, at such other place or places as the Board decides and shall always be open to inspection by the Directors. No Member (other
than a Director) shall have any right of inspecting any accounting record or book or document of the Company except as conferred by law
or authorised by the Board or the Members in general meeting.
150. (1) Subject to Article 151, a printed
copy of the Directors’ report, accompanied by the balance sheet and profit and loss account, including every document required by
law to be annexed thereto, made up to the end of the applicable financial year and containing a summary of the assets and liabilities
of the Company under convenient heads and a statement of income and expenditure, together with a copy of the Auditors’ report, shall
be sent to each person entitled thereto, provided that this Article shall not require a copy of those documents to be sent to any
person whose address the Company is not aware or to more than one of the joint holders of any shares or debentures.
(2) Where
the Company holds an annual general meeting in accordance with Article 56, the documents referred to in Article 150(1) shall be sent to
each person entitled thereto at least ten (10) days before the date of such annual general meeting, and shall be laid before the Company
at such annual general meeting.
151. Subject to due compliance with all
applicable Statutes, rules and regulations, including, without limitation, the rules of the Designated Stock Exchange, and to obtaining
all necessary consents, if any, required thereunder, the requirements of Article 150 shall be deemed satisfied in relation to any person
by sending to the person in any manner not prohibited by the Statutes, a summary financial statement derived from the Company’s
annual accounts and the directors’ report which shall be in the form and containing the information required by applicable laws
and regulations, provided that any person who is otherwise entitled to the annual financial statements of the Company and the directors’
report thereon may, if he so requires by notice in writing served on the Company, demand that the Company sends to him, in addition to
a summary financial statement, a complete printed copy of the Company’s annual financial statement and the directors’ report
thereon.
152. The requirement to send to a person
referred to in Article 150 the documents referred to in that article or a summary financial report in accordance with Article 151 shall
be deemed satisfied where, in accordance with all applicable Statutes, rules and regulations, including, without limitation, the rules
of the Designated Stock Exchange, the Company publishes copies of the documents referred to in Article 150 and, if applicable, a summary
financial report complying with Article 151, on the Company’s computer network or in any other permitted manner (including by sending
any form of electronic communication), and that person has agreed or is deemed to have agreed to treat the publication or receipt of such
documents in such manner as discharging the Company’s obligation to send to him a copy of such documents.
AUDIT
153. Subject
to applicable law and rules of the Designated Stock Exchange:
(1) The
Audit Committee or, in the absence of such an Audit Committee, the Board may appoint an auditor to audit the accounts of the Company and
such auditor shall hold office until removed from office by the Audit Committee or, in the absence of such an Audit Committee, the Board.
Such auditor may be a Member but no Director or officer or employee of the Company shall, during his continuance in office, be eligible
to act as an auditor of the Company.
(2) The
Audit Committee or, in the absence of such an Audit Committee, the Board may remove the Auditor at any time before the expiration of his
term of office and may by resolution appoint another Auditor in his stead.
154. Subject to the Act the accounts of the
Company shall be audited at least once in every year.
155. The remuneration of the Auditor shall
be determined by the Audit Committee or, in the absence of such an Audit Committee, by the Board.
156. If the office of auditor becomes vacant
by the resignation or death of the Auditor, or by his becoming incapable of acting by reason of illness or other disability at a time
when his services are required, the Directors shall fill the vacancy and determine the remuneration of such Auditor.
157. The Auditor shall at all reasonable times
have access to all books kept by the Company and to all accounts and vouchers relating thereto; and he may call on the Directors or officers
of the Company for any information in their possession relating to the books or affairs of the Company.
158. The statement of income and expenditure
and the balance sheet provided for by these Articles shall be examined by the Auditor and compared by him with the books, accounts and
vouchers relating thereto; and he shall make a written report thereon stating whether such statement and balance sheet are drawn up so
as to present fairly the financial position of the Company and the results of its operations for the period under review and, in case
information shall have been called for from Directors or officers of the Company, whether the same has been furnished and has been satisfactory.
The financial statements of the Company shall be audited by the Auditor in accordance with generally accepted auditing standards. The
Auditor shall make a written report thereon in accordance with generally accepted auditing standards and the report of the Auditor shall
be submitted to the Members in general meeting. The generally accepted auditing standards referred to herein may be those of a country
or jurisdiction other than the Cayman Islands. If so, the financial statements and the report of the Auditor should disclose this fact
and name such country or jurisdiction.
NOTICES
159. Any Notice or document, whether or not,
to be given or issued under these Articles from the Company to a Member shall be in writing or by cable, telex or facsimile transmission
message or other form of electronic transmission or communication and any such Notice and document may be served or delivered by the Company
on or to any Member either personally or by sending it through the post in a prepaid envelope addressed to such Member at his registered
address as appearing in the Register or at any other address supplied by him to the Company for the purpose or, as the case may be, by
transmitting it to any such address or transmitting it to any telex or facsimile transmission number or electronic number or address or
website supplied by him to the Company for the giving of Notice to him or which the person transmitting the notice reasonably and bona
fide believes at the relevant time will result in the Notice being duly received by the Member or may also be served by advertisement
in appropriate newspapers in accordance with the requirements of the Designated Stock Exchange or, to the extent permitted by the applicable
laws, by placing it on the Company’s website and giving to the member a notice stating that the notice or other document is available
there (a “notice of availability”). The notice of availability may be given to the Member by any of the means set out above.
In the case of joint holders of a share all notices shall be given to that one of the joint holders whose name stands first in the Register
and notice so given shall be deemed a sufficient service on or delivery to all the joint holders.
160. Any Notice or other document:
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(a)
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if served or delivered by post, shall where appropriate be sent by airmail and shall be deemed to have
been served or delivered on the day following that on which the envelope containing the same, properly prepaid and addressed, is put into
the post; in proving such service or delivery it shall be sufficient to prove that the envelope or wrapper containing the notice or document
was properly addressed and put into the post and a certificate in writing signed by the Secretary or other officer of the Company or other
person appointed by the Board that the envelope or wrapper containing the notice or other document was so addressed and put into the post
shall be conclusive evidence thereof;
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(b)
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if sent by electronic communication, shall be deemed to be given on the day on which it is transmitted
from the server of the Company or its agent. A notice placed on the Company’s website is deemed given by the Company to a Member
on the day following that on which a notice of availability is deemed served on the Member;
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(c)
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if served or delivered in any other manner contemplated by these Articles, shall be deemed to have been
served or delivered at the time of personal service or delivery or, as the case may be, at the time of the relevant despatch or transmission;
and in proving such service or delivery a certificate in writing signed by the Secretary or other officer of the Company or other person
appointed by the Board as to the act and time of such service, delivery, despatch or transmission shall be conclusive evidence thereof;
and
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(d)
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may be given to a Member in the English language or such other language as may be approved by the Directors,
subject to due compliance with all applicable Statutes, rules and regulations.
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161. (1) Any Notice or other document delivered
or sent by post to or left at the registered address of any Member in pursuance of these Articles shall, notwithstanding that such Member
is then dead or bankrupt or that any other event has occurred, and whether or not the Company has notice of the death or bankruptcy or
other event, be deemed to have been duly served or delivered in respect of any share registered in the name of such Member as sole or
joint holder unless his name shall, at the time of the service or delivery of the notice or document, have been removed from the Register
as the holder of the share, and such service or delivery shall for all purposes be deemed a sufficient service or delivery of such Notice
or document on all persons interested (whether jointly with or as claiming through or under him) in the share.
(2) A
notice may be given by the Company to the person entitled to a share in consequence of the death, mental disorder or bankruptcy of a Member
by sending it through the post in a prepaid letter, envelope or wrapper addressed to him by name, or by the title of representative of
the deceased, or trustee of the bankrupt, or by any like description, at the address, if any, supplied for the purpose by the person claiming
to be so entitled, or (until such an address has been so supplied) by giving the notice in any manner in which the same might have been
given if the death, mental disorder or bankruptcy had not occurred.
(3) Any
person who by operation of law, transfer or other means whatsoever shall become entitled to any share shall be bound by every notice in
respect of such share which prior to his name and address being entered on the Register shall have been duly given to the person from
whom he derives his title to such share.
SIGNATURES
162. For the purposes of these Articles, a
cable or telex or facsimile or electronic transmission message purporting to come from a holder of shares or, as the case may be, a Director,
or, in the case of a corporation which is a holder of shares from a director or the secretary thereof or a duly appointed attorney or
duly authorised representative thereof for it and on its behalf, shall in the absence of express evidence to the contrary available to
the person relying thereon at the relevant time be deemed to be a document or instrument in writing signed by such holder or Director
in the terms in which it is received.
WINDING UP
163. (1) The Board shall have power in the
name and on behalf of the Company to present a petition to the court for the Company to be wound up.
(2) A
resolution that the Company be wound up by the court or be wound up voluntarily shall be a special resolution.
164. (1) Subject to any special rights,
privileges or restrictions as to the distribution of available surplus assets on liquidation for the time being attached to any class
or classes of shares (i) if the Company shall be wound up and the assets available for distribution amongst the Members of the Company
shall be more than sufficient to repay the whole of the capital paid up at the commencement of the winding up, the excess shall be distributed
pari passu amongst such members in proportion to the amount paid up on the shares held by them respectively and (ii) if the Company shall
be wound up and the assets available for distribution amongst the Members as such shall be insufficient to repay the whole of the paid-up
capital such assets shall be distributed so that, a nearly as may be, the losses shall be borne by the Members in proportion to the capital
paid up, or which ought to have been paid up, at the commencement of the winding up on the shares held by them respectively.
(2) If
the Company shall be wound up (whether the liquidation is voluntary or by the court) the liquidator may, with the authority of a special
resolution and any other sanction required by the Act, divide among the Members in specie or kind the whole or any part of the assets
of the Company and whether or not the assets shall consist of properties of one kind or shall consist of properties to be divided as aforesaid
of different kinds, and may for such purpose set such value as he deems fair upon any one or more class or classes of property and may
determine how such division shall be carried out as between the Members or different classes of Members. The liquidator may, with the
like authority, vest any part of the assets in trustees upon such trusts for the benefit of the Members as the liquidator with the like
authority shall think fit, and the liquidation of the Company may be closed and the Company dissolved, but so that no contributory shall
be compelled to accept any shares or other property in respect of which there is a liability.
INDEMNITY
165. (1) The Directors, Secretary and other
officers and the liquidator or trustees (if any) for the time being acting in relation to any of the affairs of the Company and everyone
of them, and everyone of their heirs, executors and administrators, shall be indemnified and secured harmless out of the assets and profits
of the Company from and against all actions, costs, charges, losses, damages and expenses which they or any of them, their or any of their
heirs, executors or administrators, shall or may incur or sustain by or by reason of any act done, concurred in or omitted in or about
the execution of their duty, or supposed duty, in their respective offices or trusts; and none of them shall be answerable for the acts,
receipts, neglects or defaults of the other or others of them or for joining in any receipts for the sake of conformity, or for any bankers
or other persons with whom any moneys or effects belonging to the Company shall or may be lodged or deposited for safe custody, or for
insufficiency or deficiency of any security upon which any moneys of or belonging to the Company shall be placed out on or invested, or
for any other loss, misfortune or damage which may happen in the execution of their respective offices or trusts, or in relation thereto;
PROVIDED THAT this indemnity shall not extend to any matter in respect of any fraud or dishonesty which may attach to any of said persons.
(2) Each
Member agrees to waive any claim or right of action he might have, whether individually or by or in the right of the Company, against
any Director on account of any action taken by such Director, or the failure of such Director to take any action in the performance of
his duties with or for the Company; PROVIDED THAT such waiver shall not extend to any matter in respect of any fraud or dishonesty which
may attach to such Director.
AMENDMENT TO MEMORANDUM AND ARTICLES OF ASSOCIATION
AND NAME OF COMPANY
166. No Article shall be rescinded, altered
or amended and no new Article shall be made until the same has been approved by a special resolution of the Members. A special resolution
shall be required to alter the provisions of the Memorandum of Association or to change the name of the Company.
INFORMATION
167. No Member shall be entitled to require discovery
of or any information respecting any detail of the Company’s trading or any matter which is or may be in the nature of a trade
secret or secret process which may relate to the conduct of the business of the Company and which in the opinion of the Directors it
will be inexpedient in the interests of the members of the Company to communicate to the public.
- 52 -
Exhibit 4.2
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
TO
[ ]
Trustee
Indenture
Dated as of __, 20__
TABLE OF CONTENTS
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Page
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ARTICLE I
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DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
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Section 101.
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Definitions
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1
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Section 102.
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Compliance Certificates and Opinions
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9
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Section 103.
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Form of Documents Delivered to Trustee
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9
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Section 104.
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Acts of Holders
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10
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Section 105.
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Notices, Etc. to Trustee and Company
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11
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Section 106.
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Notice to Holders; Waiver
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11
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Section 107.
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Conflict With Trust Indenture Act
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12
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Section 108.
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Effect of Headings and Table of Contents
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12
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Section 109.
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Successors and Assigns
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12
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Section 110.
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Separability Clause
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12
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Section 111.
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Benefits of Indenture
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12
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Section 112.
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Governing Law
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13
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Section 113.
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Legal Holidays
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13
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Section 114.
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Rules by Trustee and Agents
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13
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Section 115.
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No Recourse Against Others
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13
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ARTICLE II
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SECURITY FORMS
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Section 201.
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Forms Generally
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13
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Section 202.
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Form of Trustee’s Certificate of Authentication
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14
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ARTICLE III
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THE SECURITIES
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Section 301.
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Amount Unlimited; Issuable in Series
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14
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Section 302.
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Denominations
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19
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Section 303.
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Execution, Authentication, Delivery and Dating
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19
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Section 304.
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Temporary Securities
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21
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Section 305.
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Registration, Registration of Transfer and Exchange
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22
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Section 306.
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Mutilated, Destroyed, Lost and Stolen Securities
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23
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Section 307.
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Payment of Interest; Interest Rights Preserved
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24
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Section 308.
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Persons Deemed Owners
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25
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Section 309.
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Cancellation
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26
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Section 310.
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Computation of Interest
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26
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Section 311.
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Global Securities; Exchanges; Registration and Registration of Transfer
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26
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Section 312.
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Extension of Interest Payment
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28
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ARTICLE IV
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SATISFACTION AND DISCHARGE
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Section 401.
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Satisfaction and Discharge of Indenture
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28
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Section 402.
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Application of Trust Money
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29
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Section 403.
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Satisfaction, Discharge and Defeasance of Securities of Any Series
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30
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ARTICLE V
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REMEDIES
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Section 501.
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Events of Default
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31
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Section 502.
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Acceleration of Maturity; Rescission and Annulment
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33
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Section 503.
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Collection of Indebtedness and Suits for Enforcement by Trustee
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34
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Section 504.
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Trustee May File Proofs of Claim
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35
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Section 505.
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Trustee May Enforce Claims Without Possession of Securities or Coupons
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35
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Section 506.
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Application of Money Collected
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36
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Section 507.
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Limitation on Suits
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36
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Section 508.
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Unconditional Right of Holders to Receive Principal, Premium and Interest
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37
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Section 509.
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Restoration of Rights and Remedies
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37
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Section 510.
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Rights and Remedies Cumulative
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37
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Section 511.
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Delay or Omission Not Waiver
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37
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Section 512.
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Control by Holders
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37
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Section 513.
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Waiver of Past Defaults
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38
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Section 514.
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Undertaking for Costs
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38
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Section 515.
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Waiver of Stay or Extension Laws
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38
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ARTICLE VI
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THE TRUSTEE
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Section 601.
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Certain Duties and Responsibilities
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39
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Section 602.
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Notice of Defaults
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40
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Section 603.
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Certain Rights of Trustee
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40
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Section 604.
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Not Responsible for Recitals or Issuance of Securities
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41
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Section 605.
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May Hold Securities
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41
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Section 606.
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Money Held in Trust
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41
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Section 607.
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Compensation and Reimbursement
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41
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Section 608.
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Disqualification; Conflicting Interests
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42
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Section 609.
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Corporate Trustee Required; Eligibility
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42
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Section 610.
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Resignation and Removal; Appointment of Successor
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42
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Section 611.
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Acceptance of Appointment by Successor
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43
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Section 612.
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Merger, Conversion, Consolidation or Succession to Business
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44
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Section 613.
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Preferential Collection of Claims Against Company
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44
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Section 614.
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Appointment of Authenticating Agent
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44
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ARTICLE VII
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HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY
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Section 701.
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Company to Furnish Trustee Names and Addresses of Holders
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46
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Section 702.
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Preservation of Information; Communications to Holders
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46
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Section 703.
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Reports by Trustee
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47
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Section 704.
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Reports by Company
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48
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ARTICLE VIII
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CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER
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Section 801.
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Company May Consolidate, Etc. Only on Certain Terms
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49
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Section 802.
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Successor Corporation Substituted
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49
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ARTICLE IX
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SUPPLEMENTAL INDENTURES
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Section 901.
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Supplemental Indentures Without Consent of Holders
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50
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Section 902.
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Supplemental Indentures With Consent of Holders
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52
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Section 903.
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Execution of Supplemental Indentures
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53
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Section 904.
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Effect of Supplemental Indentures
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54
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Section 905.
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Conformity With Trust Indenture Act
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54
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Section 906.
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Reference in Securities to Supplemental Indentures
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54
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Section 907.
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Revocation and Effect of Consents
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54
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Section 908.
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Modification Without Supplemental Indenture
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54
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ARTICLE X
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COVENANTS
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Section 1001.
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Payment of Principal, Premium and Interest
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55
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Section 1002.
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Maintenance of Office or Agency
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56
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Section 1003.
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Money for Securities Payments to Be Held in Trust
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56
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Section 1004.
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Corporate Existence
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57
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Section 1005.
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Defeasance of Certain Obligations
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58
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Section 1006.
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Statement by Officers as to Default
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59
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Section 1007.
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Waiver of Certain Covenants
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59
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Section 1008.
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Maintenance of Properties
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59
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ARTICLE XI
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REDEMPTION OF SECURITIES
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Section 1101.
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Applicability of Article
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60
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Section 1102.
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Election to Redeem; Notice to Trustee
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60
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Section 1103.
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Selection by Trustee of Securities to Be Redeemed
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60
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Section 1104.
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Notice of Redemption
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60
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Section 1105.
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Securities Payable on Redemption Date
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62
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Section 1106.
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Securities Redeemed in Part
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62
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ARTICLE XII
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SINKING FUNDS
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Section 1201.
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Applicability of Article
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63
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Section 1202.
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Satisfaction of Sinking Fund Payments With Securities
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63
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Section 1203.
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Redemption of Securities for Sinking Fund
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63
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ARTICLE XIII
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REPAYMENT OF SECURITIES AT OPTION OF HOLDERS
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Section 1301.
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Applicability of Article
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64
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Section 1302.
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Notice of Repayment Date
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64
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Section 1303.
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Securities Payable on Repayment Date
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65
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Section 1304.
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Securities Repaid in Part
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65
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INDENTURE, dated as of [ ],
20__, between E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED, a company organized and existing under the laws of the Cayman Islands (herein
called the “Company”), and [ ] (herein called the “Trustee”).
Recitals
Of The Company
The Company has duly authorized
the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other
evidences of indebtedness (each herein called a “Security” or collectively the “Securities”),
in an unlimited aggregate principal amount to be issued in one or more series as in this Indenture provided.
All things necessary to make
this Indenture a valid agreement of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE
WITNESSETH:
For and in consideration of
the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate
benefit of all Holders of the Securities or of any series thereof, as follows:
ARTICLE
I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires;
(1) the terms defined in this
Article have the meanings assigned to them in this Article and include the plural as well as the singular;
(2) all other terms used herein
which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;
(3) all accounting terms not
otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as
otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any
computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States at the
date of such computation or, at the election of the Company from time to time, at the date of the execution and delivery of this Indenture;
(4) the word “or”
is not exclusive; and
(5) the words “herein”,
“hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
Certain terms, used principally
in Article VI, are defined in that Article.
“Act”,
when used with respect to any Holder, has the meaning specified in Section 104.
“Affiliate”
of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified
Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative
to the foregoing.
“Authenticating
Agent” means any Person authorized by the Trustee to act on behalf of the Trustee to authenticate Securities.
“Authorized Newspaper”
means a newspaper of general circulation, in an official language of the country of publication or in the English language, customarily
published on a daily basis (including newspapers published on a daily basis except not published on Legal Holidays, as defined in Section
113) in such country. Whenever successive weekly publications in an Authorized Newspaper are required hereunder, they may be made
(unless otherwise expressly provided herein) on the same or different days of the week and in the same or different Authorized Newspapers.
“Authorized Officer”
means the Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer, the Secretary, any Assistant Secretary or any
other officer or agent of the Company duly authorized by the Board of Directors to act in respect of matters relating to this Indenture.
“Board of Directors”
means either the board of directors of the Company or any duly authorized committee of that board.
“Board Resolution”
means a copy of a resolution certified by the Secretary, an Assistant Secretary or director of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee.
“Business Day”,
when used with respect to any Place of Payment or any other particular location specified in the Securities or this Indenture, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment such other location,
or the city in which the Corporate Trust Office of the Trustee is located, are authorized or obligated by law to close, except as may
be otherwise specified as contemplated by Section 301.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Commission”
means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
“Company”
means the Person named as the “Company” in the first paragraph of this instrument until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.
“Company Request”
or “Company Order” means a written request or order signed in the name of the Company by an Authorized Officer
and delivered to the Trustee.
“Corporate Trust
Office” means the principal office of the Trustee at which at any particular time its corporate trust business shall be
administered and, with respect to [ ], shall be located in [ ].
“Corporation”
includes corporations, associations, joint stock companies, limited liability companies and business trusts.
“Defaulted Interest”
has the meaning specified in Section 307.
“Depository”
means, with respect to any series of Securities issuable or issued in the form of a Global Security, an entity named as such in the Indenture,
or, if no entity is so named, an entity, if any, named by the Company as such by Board Resolution, or its successor. The Depository is
the entity which holds a Global Security, if any, and operates the computerized book-entry system through which ownership interests in
the Securities are recorded. Such entity shall at all times be a registered clearing agency under the Securities Exchange Act of 1934,
as amended, and in good standing thereunder or, in the case of an entity that holds a Global Security issued outside of the United States,
such entity shall at all times be in compliance with any applicable registration requirements and in good standing under application regulations.
“Dollar”
or “$” means a dollar or other equivalent unit in such coin or currency of the United States as at the time
shall be legal tender for the payment of public and private debts.
“Eligible Obligations”
means:
(a) with respect to Securities
denominated in Dollars, U.S. Government Obligations; or
(b) with respect to Securities
denominated in a currency other than Dollars or in a composite currency, such other obligations or instruments as shall be specified with
respect to such Securities, as contemplated by Section 301(24).
“Event of Default”
has the meaning specified in Section 501.
“Global Security”
means a Security, if any, issued to evidence all or a part of a series of Securities in accordance with Section 301.
“Holder”
means the bearer of an Unregistered Security or coupon appertaining thereto or a Person in whose name a Registered Security is registered
in the Security Register or the Person who is the record owner of any ownership interests in a Global Security.
“Indenture”
means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and shall include the terms of particular series of Securities established
as contemplated by Section 301.
“Indexed Security”
means a Security the terms of which provide that the principal amount thereof payable at Stated Maturity may be more or less than the
principal face amount thereof at original issuance.
“Interest”,
when used with respect to an Original Issue Discount Security that by its terms bears interest only after Maturity, means interest payable
after Maturity.
“Interest Payment
Date”, when used with respect to any Security, means the Stated Maturity of an installment of interest on such Security.
“Maturity”,
when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes
due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, upon call for redemption,
exercise of repayment option or otherwise.
“Officer’s
Certificate” means a certificate signed by an Authorized Officer and delivered to the Trustee.
“Opinion of Counsel”
means a written opinion of counsel, who may be an employee of, or counsel for, the Company or an Affiliate of the Company, and who shall
be acceptable to the Trustee.
“Original Issue
Discount Security” means any Security that provides for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to Section 502.
“Outstanding”,
when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(a) Securities theretofore
cancelled by the Trustee or delivered to the Trustee for cancellation;
(b) Securities or
portions thereof for whose payment or redemption (a) money in the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities or (b) Eligible Obligations as contemplated by Sections 401 and 403 in
the necessary amount have been theretofore deposited with the Trustee, in trust, for the Holders of such Securities (whether or not the
Company’s indebtedness in respect thereof shall be satisfied and discharged for purposes of this Indenture or otherwise), provided
that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(c) Securities that
have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered
pursuant to this Indenture, other than any such Securities in respect of which there have been presented to the Trustee proof satisfactory
to it and the Company that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the
Company;
provided, however, that in determining
whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder,
(w) Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor (unless the Company, such Affiliate
or such obligor owns (i) all Securities Outstanding under this Indenture or (ii) except for the purposes of actions to be taken by Holders
of more than one series or Tranche voting as a class, all Outstanding Securities of each such series and each such Tranche, as the case
may be, determined without regard to this clause) shall be disregarded and deemed not to be Outstanding, except that, in determining whether
the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities
which the Trustee knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded
as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such
other obligor;
(x) in determining whether the Holders
of the requisite principal amount of Securities of any series or Tranche have concurred in any direction, waiver or consent, the principal
amount of Original Issue Discount Securities that shall be deemed to be outstanding shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon acceleration of the maturity thereof pursuant to Section 502;
(y) in the case of any Security the
principal of which is payable from time to time without presentment or surrender, the principal amount of such Security that shall be
deemed to be Outstanding at any time for all purposes of this Indenture shall be the original principal amount thereof less the aggregate
amount of principal thereof theretofore paid; and
(z) the principal amount of any Security
which is denominated in a currency other than Dollars or in a composite currency that shall be deemed to be Outstanding for such purposes
shall be the amount of Dollars that could have been purchased by the principal amount (or, in the case of an Original Issue Discount Security,
the Dollar equivalent on the date determined as set forth below of the amount determined as provided in (x) above) of such currency or
composite currency evidenced by such Security, in each such case certified to the Trustee in an Officer’s Certificate based (i)
on the average of the mean of the buying and selling spot rates quoted by three banks which are members of the New York Clearing House
Association selected by the Company in effect at 11:00 A.M. (New York time) in The City of New York on the fifteenth Business Day preceding
any such determination or (ii) if on such fifteenth Business Day it is not possible or practicable to obtain such quotations from such
three banks, on such other quotations or alternative methods of determination that shall be as consistent as practicable with the method
set forth in (i) above.
“Paying Agent”
means any Person, including the Company, authorized by the Company to pay the principal of (and premium, if any) or interest on any Securities
on behalf of the Company.
“Periodic Offering”
means an offering of Securities of a series from time to time any or all of the specific terms of which Securities, including without
limitation the rate or rates of interest, if any, thereon, the Stated Maturity or Maturities thereof and the redemption provisions, if
any, with respect thereto, are to be determined by the Company or its agents from time to time subsequent to the initial request for the
authentication and delivery of such Securities by the Trustee, all as contemplated in Section 301 and clause (2) of Section
303.
“Person”
means any individual, corporation, partnership, limited liability company, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political subdivision thereof.
“Place of Payment”,
when used with respect to the Securities of any series, or any Tranche thereof, means the place or places where the principal of (and
premium, if any) and interest, if any, on the Securities of that series or Tranche are payable as specified as contemplated by Section
301.
“Predecessor Security”
of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular
Security, and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost
or stolen Security.
“Redemption Date”,
when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to Section 301 of
this Indenture.
“Redemption Price”,
when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture, exclusive
of accrued and unpaid interest, if any.
“Registered Security”
means any Security issued hereunder and registered by the Security Registrar or any recorded interest in a Global Security issued hereunder.
“Regular Record
Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for
that purpose as contemplated by Section 301.
“Repayment Date”,
when used with respect to any Security of any series to be repaid or repurchased, means the date, if any, fixed for such repayment or
for such repurchase (whether at the option of the Holders or otherwise) pursuant to Section 301 of this Indenture.
“Repayment Price”,
when used with respect to any Security of any series to be repaid, means the price, if any, at which it is to be repaid pursuant to Section
301.
“Responsible Officer”,
when used with respect to the Trustee, means any officer within the corporate trust department or any other successor group of the Trustee,
including any vice president, assistant vice president, assistant secretary or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust
matter, any other officer of the Trustee to whom such matter is referred because of his knowledge of and familiarity with the particular
subject.
“Security”
or “Securities” has the meaning stated in the first recital of this Indenture and more particularly means any
Security or Securities authenticated and delivered under this Indenture.
“Security Register”
and “Security Registrar” have the respective meanings specified in Section 305.
“Senior Securities”
means Securities other than Subordinated Securities.
“series”
or “series of Securities” means a series of Securities issued under this Indenture as determined by Board Resolution
or as otherwise determined under this Indenture, and except as otherwise provided in Section 608.
“Special Record
Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 307.
“Stated Maturity”,
when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.
“Subordinated
Securities” means Securities that by the terms established pursuant to Subsection 301(10) are subordinate to any specified
debt of the Company.
“Subsidiary”
means (i) any corporation, association or other business entity of which more than 50% of the outstanding total voting stock entitled
(without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries or (ii) any partnership the sole general partner or the managing general partner of which is the Company or a Subsidiary
of the Company or the only general partners of which are the Company or of one or more Subsidiaries of the Company (or any combination
thereof). For the purposes of this definition, “voting stock” means, in the case of a corporation, stock which ordinarily
has voting power for the election of directors, whether at all times or only so long as no senior class of capital stock has such voting
power by reason of any contingency, in the case of an association or business entity, any and all shares, interests, participations, rights
or other equivalents (however designated) of corporate stock, in the case of a partnership or limited liability company, partnership or
membership interests (whether general or limited), and any other interest or participation that confers on a Person the right to receive
a share of the profits and losses of, or distributions of assets of, the issuing Person.
“Tranche”
means a group of Securities which (a) are of the same series and (b) have identical terms except as to principal amount or date of issuance.
“Trustee”
means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have been
appointed with respect to one or more series of Securities pursuant to the applicable provisions of this Indenture, and thereafter “Trustee”
shall mean or include each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, “Trustee”
as used with respect to the Securities of any series shall mean the Trustee with respect to Securities of that series.
“Trust Indenture
Act” means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed, except as provided
in Section 905.
“U.S. Government
Obligations” means (a) direct obligations of the United States for the payment of which its full faith and credit is pledged,
or obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States and the payment
of which is unconditionally guaranteed by the United States and (b) certificates, depositary receipts or other instruments which evidence
a direct ownership interest in obligations described in clause (a) above or in any specific interest or principal payments due in respect
thereof; provided, however, that the custodian of such obligations or specific interest or principal payments shall be a bank or
trust company (which may include the Trustee or any Paying Agent) subject to federal or state supervision or examination with a combined
capital and surplus of at least $50,000,000; and provided, further, that except as may be otherwise required by law, such custodian
shall be obligated to pay to the holders of such certificates, depositary receipts or other instruments the full amount received by such
custodian in respect of such obligations or specific payments and shall not be permitted to make any deduction therefrom.
“U.S. Person”
means a citizen, national or resident of the United States, a corporation, partnership, limited liability company, or other entity created
or organized in or under the laws of the United States or any political subdivision thereof, or an estate or trust whose income from sources
without the United States is includible in gross income for United States federal income tax purposes regardless of its connection with
the conduct of a trade or business within the United States.
“Unregistered
Security” means any Security issued hereunder which is not a Registered Security.
“Vice President”,
when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words
added before or after the title “vice president”.
“Yield to Maturity”
means the yield to maturity, calculated by the Company at the time of issuance of a series of Securities or, if applicable, at the most
recent determination of interest on such series in accordance with accepted financial practice.
Section 102. Compliance Certificates
and Opinions. Except as otherwise expressly provided in this Indenture upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall, if requested by the Trustee, furnish to the Trustee an Officer’s
Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied
with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any
provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.
Every certificate or opinion
with respect to compliance with a condition or covenant provided for in this Indenture (other than certificates provided pursuant to Section
704(4)) shall include:
(1) a statement
that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;
(2) a brief statement
as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or
opinion are based;
(3) a statement
that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been complied with; and
(4) a statement
as to whether, in the opinion of each such individual, such condition or covenant has been complied with.
Section 103. Form of Documents
Delivered to Trustee. In any case where several matters are required to be certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several
documents.
Any certificate or opinion
of an officer of the Company may be based, insofar as it relates to legal matters, upon an Opinion of Counsel. Any such Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers
of the Company stating that the information with respect to such factual matters is in the possession of the Company.
Where any Person is required
to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this
Indenture, they may, but need not, be consolidated and form one instrument.
Section 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be made, given
or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders
in person or by an agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective
when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument
or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act”
of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent,
or of the holding by any Person of Unregistered Securities, shall be sufficient for any purpose of this Indenture and (subject to Section
601) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the
execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate
of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of
any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner acceptable to
the Trustee.
(c) The amount of Unregistered
Securities held by any Person executing any such instrument or writings as the Holder thereof, and the numbers of such Unregistered Securities,
and the date of his holding the same, may be proved by the production of such Unregistered Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or member of a national securities exchange (wherever situated), if such certificate is
in form satisfactory to the Trustee, showing that at the date therein mentioned such Person had on deposit with such depositary, or exhibited
to it, the Unregistered Securities therein described; or such facts may be proved by the certificate or affidavit of the Person executing
such instrument or writing as the Holder thereof, if such certificate or affidavit is in form satisfactory to the Trustee. The Trustee
and the Company may assume that such ownership of any Unregistered Securities continues until (1) another certificate bearing a later
date issued in respect of the same Unregistered Securities is produced, or (2) such Unregistered Securities are produced by some other
Person, or (3) such Unregistered Securities are registered as to principal or are surrendered in exchange for Unregistered Securities,
or (4) such Unregistered Securities are no longer Outstanding.
(d) The fact and date of execution
of any such instrument or writing and the amount and number of Unregistered Securities held by the Person so executing such instrument
or writing may also be proved in any other manner that the Trustee deems sufficient; and the Trustee may in any instance require further
proof with respect to any of the matters referred to in this Section.
(e) The principal amount (except
as otherwise contemplated in clause (x) of the proviso to the definition of “Outstanding”) and serial numbers of Securities
held by any Person, and the date of holding the same, shall be proved by the Security Register.
(f) Any request, demand, authorization,
direction, notice, consent, election, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security
and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect
of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action
is made upon such Security.
(g) The Company may set a record
date for purposes of determining the identity of Holders of any Securities of any series entitled to vote or consent to any action by
vote or consent authorized or permitted by Section 512 or 513. Such record date shall be the later of 30 days prior to the
first solicitation of such consent or the date of the most recent list of Holders of such Securities furnished to the Trustee pursuant
to Section 701 prior to such solicitation.
(h) If the Company solicits
from Holders any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, fix
in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent,
waiver or other Act, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close
of business on the record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion
of the Outstanding Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the Outstanding Securities shall be computed as of the record date.
Section 105. Notices, Etc.
to Trustee and Company. Except as otherwise provided herein, any request, demand, authorization, direction, notice, consent, election,
waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee
by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with
the Trustee at its Corporate Trust Office, Attention: [ ], [ ], or
(2) the Company
by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously furnished in writing to the Trustee by the Company.
Section 106. Notice to
Holders; Waiver. Except as otherwise expressly provided herein, where this Indenture provides for notice of any event or reports to
Holders, such notice or report shall be sufficiently given if in writing and mailed, first-class postage prepaid, to each Holder of Registered
Securities affected by such event, at the address of such Holder as it appears in the Security Register and to addresses filed with the
Trustee or preserved on the Trustee’s list pursuant to Section 702(a) for other Holders (and to such other addressees as
may be required in the case of such notice or report under Section 313(c) of the Trust Indenture Act), not later than the latest date,
and not earlier than the earliest date, prescribed for the giving of such notice or report.
In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders.
Notice shall be sufficiently
given to Holders of Unregistered Securities if published in an Authorized Newspaper in each of The City of New York and, if such Securities
are listed on any stock exchange outside of the United States, in the city in which such stock exchange is located, or in such other city
or cities as may be specified in the Securities, once in each of two different calendar weeks, the first publication to be not earlier
than the earliest date, and not later than the last date, if any, prescribed for the giving of such notice.
Where this Indenture provides
for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the
event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension
of regular mail service or by reason of any other cause is impracticable to give such notice by mail, then such notification that is made
with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.
If it is impractical in the
opinion of the Trustee or the Company to make any publication of any notice required hereby in an Authorized Newspaper, any publication
or other notice in lieu thereof that is made or given with the approval of the Trustee shall constitute a sufficient publication of such
notice.
Section 107. Conflict With
Trust Indenture Act. If any provision hereof limits, qualifies or conflicts with the duties imposed by operation of subsection (c)
of Section 318 of the Trust Indenture Act, the imposed duties shall control.
Section 108. Effect of
Headings and Table of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall
not affect the construction hereof.
Section 109. Successors
and Assigns. All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed
or not.
Section 110. Separability
Clause. In case any provision in this Indenture or in the Securities is invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of
Indenture. Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto
(including any Paying Agent appointed pursuant to Section 1002 and Authenticating Agent appointed pursuant to Section 614
to the extent provided herein) and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
Section 112. Governing
Law. This Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity of any Security is not a Business Day
at any Place of Payment or the city in which the Corporate Trust Office of the Trustee is located, then (notwithstanding any other provision
of this Indenture or of the Securities other than a provision in Securities of any series, or any Tranche thereof, or in the Board Resolution
or Officer’s Certificate that establishes the terms of such Securities or Tranche, that specifically states that such provision
shall apply in lieu of this Section) payment of interest or principal (and premium, if any) need not be made at such Place of Payment
on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on
the Interest Payment Date or Redemption Date, Repayment Date, or at the Stated Maturity, provided that no interest shall accrue
with respect to such payment for the period from and after such Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity,
as the case may be.
Section 114. Rules by Trustee
and Agents. The Trustee may make reasonable rules for action by or at a meeting of Holders of one or more series. The Paying Agent
or Security Registrar may make reasonable rules and set reasonable requirements for its functions.
Section 115. No Recourse
Against Others. No past, present or future director, officer, stockholder or employee, as such, of the Company or any successor corporation
shall have any liability for any obligation of the Company under the Securities or the Indenture or for any claim based on, in respect
of or by reason of such obligations or their creation. Each Holder by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the execution of this Indenture and the issue of the Securities.
ARTICLE
II
SECURITY FORMS
Section 201. Forms Generally.
The Securities of each series and related coupons, if any, shall be in substantially the form as shall be established by or pursuant to
a Board Resolution or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently
herewith, be determined by the officers executing such Securities, as evidenced by their execution of the Securities. When the form of
Securities of any series is established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 303 for the authentication
and delivery of such Securities.
If required or appropriate
under applicable law, Unregistered Securities and their coupons must have the following statement on their face: “Any United States
person who holds this obligation will be subject to limitations under the United States income tax laws, including the limitations provided
in Sections 165(j) and 1287(a) of the Internal Revenue Code”. If required or appropriate under applicable law, Unregistered Securities
and their coupons must have the following statement on their face: “By accepting this obligation, the Holder represents and warrants
that it is not a U.S. Person (other than an exempt recipient described in section 6049(b)(4) of the Internal Revenue Code and the regulations
thereunder) and that it is not acting for or on behalf of a U.S. Person (other than an exempt recipient described in section 6049(b)(4)
of the Internal Revenue Code and the regulations thereunder).”
The definitive Securities
shall be produced in such manner or combination of manners, all as determined by the officers executing such Securities, as evidenced
by their execution of such Securities.
Section 202. Form of Trustee’s
Certificate of Authentication. The Trustee’s certificate of authentication shall be in substantially the following form:
This is one of the Securities
of the series designated herein, referred to in the within-mentioned Indenture.
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as Trustee
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By
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Authorized Officer
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ARTICLE
III
THE SECURITIES
Section 301. Amount Unlimited;
Issuable in Series. The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.
The Securities may be issued
in one or more series. There may be Registered Securities and Unregistered Securities within a series. Registered and Unregistered Securities
may be in temporary or permanent global form. Unregistered Securities may be issued with or without coupons attached. Unregistered Securities
may be subject to such restrictions, and contain such legends, as may be required by United States laws and regulations. Subject to the
last paragraph of this Section, there shall be established in or pursuant to a Board Resolution, and set forth in an Officer’s Certificate,
or established in one or more indentures supplemental hereto, prior to the issuance of Securities of any series,
(1) the title of
the Securities of the series (which shall distinguish the Securities of the series from all other Securities);
(2) any limit upon
the aggregate principal amount of the Securities of the series that may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series
pursuant to Section 304, 305, 306, 906, 1107 or 1305 and except for any Securities that, pursuant
to Section 303, are deemed never to have been authenticated and delivered hereunder);
(3) the price or
prices (expressed as a percentage of the principal amount thereof) at which the securities will be issued and the date or dates on which
the principal (and premium, if any) of the Securities of the series, or any Tranche thereof, is payable;
(4) the date or
dates on which the principal of the Securities of such series, or any Tranche thereof, is payable or any formula or other method or other
means by which such date or dates shall be determined, by reference to an index or other fact or event ascertainable outside of this Indenture
or otherwise (without regard to any provisions for redemption, prepayment, acceleration, purchase or extension);
(5) the rate or
rates at which the Securities of such series, or any Tranche thereof, shall bear interest, if any (including the rate or rates at which
overdue principal shall bear interest, if different from the rate or rates at which such Securities shall bear interest prior to Maturity,
and, if applicable, the rate or rates at which overdue premium or interest shall bear interest, if any), or any formula or other method
or other means by which such rate or rates shall be determined, by reference to an index or other fact or event ascertainable outside
of this Indenture or otherwise; the date or dates from which such interest shall accrue; the Interest Payment Dates on which such interest
shall be payable and the Regular Record Date, if any, for the interest payable on such Securities on any Interest Payment Date; the right
of the Company, if any, to extend the interest payment periods and the duration of any such extension as contemplated by Section 312;
and the basis of computation of interest, if other than as provided in Section 310;
(6) the place or
places where the principal of (and premium, if any) and interest, if any, on Securities of the series, or any Tranche thereof, shall be
payable, any Registered Securities of the series, or any Tranche thereof, may be surrendered for registration of transfer, Securities
of the series, or any Tranche thereof, may be surrendered for exchange, and where notices and demands to or upon the Company in respect
of the Securities of the series, or any Tranche thereof, and this Indenture may be served and notices to Holders pursuant to Section
106 will be published; the Security Registrar and any Paying Agent or Agents for such series or Tranche; and if such is the case,
that the principal of such Securities shall be payable without presentment or surrender thereof;
(7) if applicable,
the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series, or
any Tranche thereof, may be redeemed, in whole or in part, at the option of the Company;
(8) the obligation,
if any, of the Company to redeem or purchase Securities of the series, or any Tranche thereof, pursuant to any sinking fund or analogous
provisions and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of
the series, or any Tranche thereof, shall be redeemed or purchased, in whole or in part, pursuant to such obligation;
(9) the obligation,
if any, of the Company to offer to repay or repurchase Securities of the series, or any Tranche thereof, in circumstances described therein,
and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series,
or any Tranche thereof, shall be repaid or repurchased, in whole or in part, at the option of the Holders;
(10) the terms,
if any, on which the Securities of such series will be subordinate in right and priority of payment to other debt of the Company;
(11) the right,
if any, of the Company to execute and deliver to the Trustee, and to direct the Trustee to authenticate and deliver in accordance with
a Company Order, a Security of any series, or any Tranche thereof, in lieu of or in exchange for any Securities of such series, or any
Tranche thereof, cancelled upon redemption or repayment;
(12) the denominations
in which any Registered Securities of the series, or any Tranche thereof, shall be issuable, if other than denominations of $1,000 and
any integral multiple thereof, and the denomination or denominations in which any Unregistered Securities of the series, or any Tranche
thereof, shall be issuable, if other than the denomination of $5,000;
(13) if other than
the principal amount thereof, the portion of the principal amount of Securities of the series, or any Tranche thereof, that shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to Section 502;
(14) whether Securities
of the series are to be issuable as Registered Securities, Unregistered Securities, or both, whether Securities of the series are to be
issuable with or without coupons, whether any Securities of the series are to be issuable initially in temporary global form (and, if
so, the identity of the depositary for such Securities) and the circumstances under which such Securities in temporary global form may
be exchanged for definitive Securities, and whether any Securities of the series are to be issuable in permanent global form (and, if
so, the identity of the depositary for such Securities) with or without coupons and, if so, whether beneficial owners of interests in
any such permanent Global Security may exchange such interests for Securities of such series and of like tenor of any authorized form
and denomination and the circumstances under which any such exchanges may occur, if other than in the manner provided in Section 311;
(15) whether and
under what circumstances the Company will pay additional amounts on the Securities of that series held by a person who is not a U.S. Person
in respect of taxes or similar charges withheld or deducted and, if so, whether the Company will have the option to redeem such Securities
rather than pay such additional amounts;
(16) the currency
or currencies, including composite currencies, in which payment of the principal of (and premium, if any) and interest, if any, on the
Securities of the series, or any Tranche thereof, shall be payable (if other than the currency of the United States of America) and the
formula or other method or other means by which the equivalent of any such amount in Dollars is to be determined for any purpose, including
for the purpose of determining the principal amount of such Securities deemed to be Outstanding at any time;
(17) if the principal
of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, are to be payable, at the election
of the Company or a Holder thereof, in a coin or currency other than that in which the Securities are stated to be payable, the period
or periods within which, and the terms and conditions upon which, such election may be made;
(18) if the principal
of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, are to be payable, or are to be
payable at the election of the Company or a Holder thereof, in securities or other property, the type and amount of such securities or
other property, or the formula or other method or other means by which such amount shall be determined, and the period or periods within
which, and the terms and conditions upon which, any such election may be made;
(19) if the amount
of payments of principal of (and premium, if any) or interest on the Securities of the series may be determined with reference to an index
or other fact or event ascertainable outside of this Indenture, the manner in which such amounts shall be determined to the extent not
established pursuant to paragraph (5) of this Section;
(20) the form or
forms of the Securities, including such legends as may be required by United States laws or regulations, the form of any coupons or temporary
Global Security, if any, which may be issued and the forms of any certificates which may be required hereunder or under United States
laws or regulations in connection with the offering, sale, delivery or exchange of Unregistered Securities, if any;
(21) the Person
to whom any interest on any Registered Security of the series, or any Tranche thereof, shall be payable, if other than the Person in whose
name that Security is registered at the close of business on the Regular Record Date for such interest, and the manner in which, or the
Person to whom, any interest on any Unregistered Security of the series, or any Tranche thereof, shall be payable, if otherwise than upon
presentation and surrender of the coupons appertaining thereto as they severally mature, and the extent to which, or the manner in which,
any interest payable on a temporary or permanent Global Security on an interest payment date will be paid;
(22) any Events
of Default, in addition to those specified in Section 501, with respect to the Securities of such series, and any covenants of
the Company for the benefit of the Holders of the Securities of such series, or any Tranche thereof, in addition to those set forth in
Article X;
(23) the terms,
if any, pursuant to which the Securities of such series, or any Tranche thereof, may be converted into or exchanged for shares of capital
stock or other securities of the Company or any other Person;
(24) the obligations
or instruments, if any, that shall be considered to be Eligible Obligations in respect of the Securities of such series, or any Tranche
thereof, denominated in a currency other than Dollars or in a composite currency, and any additional or alternative provisions for the
reinstatement of the Company’s indebtedness in respect of such Securities after the satisfaction and discharge thereof as provided
in Section 401;
(25) any exceptions
to Section 113, or variation in the definition of Business Day, with respect to the Securities of such series, or any Tranche thereof;
(26) any collateral
security, assurance or guarantee for the Securities of such series;
(27) the non-applicability
of Section 608 to the Securities of such series or any exceptions or modifications of Section 608 with respect to the Securities
of such series;
(28) any rights
or duties of another Person to assume the obligations of the Company with respect to the Securities of such series (whether as joint obligor,
primary obligor, secondary obligor or substitute obligor) and any rights or duties to discharge and release any obligor with respect to
the Securities of such series or this Indenture to the extent related to such series;
(29) if a service
charge will be made for the registration of transfer or exchange of Securities of such series, or any Tranche thereof, the amount or terms
thereof; and
(30) any other terms,
conditions and rights of the series (which terms, conditions and rights shall not be inconsistent with the provisions of this Indenture,
except as permitted by Section 901(5)).
All Securities of any one
series and the coupons appertaining to any Unregistered Securities of such series shall be substantially identical except in the case
of Registered Securities as to denomination and except as may otherwise be provided in or pursuant to such Board Resolution and set forth
in such Officer’s Certificate or in any such indenture supplemental hereto and as reasonably acceptable to the Trustee. Securities
of different series may differ in any respect.
If the terms and form or forms
of any series of Securities are established by or pursuant to a Board Resolution, the Company shall deliver a copy of such Board Resolution
to the Trustee at or prior to the issuance of such series with (1) the form or forms of Security that have been approved attached thereto,
or (2) if such Board Resolution authorizes a specific officer or officers to approve the terms and form or forms of the Securities, a
certificate of such officer or officers approving the terms and form or forms of Security with such form or forms of Securities attached
thereto. Such Board Resolution or certificate may provide general terms or parameters for Securities of any series and may provide that
the specific terms of particular Securities of a series may be determined in accordance with or pursuant to the Company Order referred
to in Section 303 hereof.
With respect to Securities
of a series subject to a Periodic Offering, the indenture supplemental hereto or the Board Resolution that establishes such series, or
the Officer’s Certificate pursuant to such supplemental indenture or Board Resolution, as the case may be, may provide general terms
or parameters for Securities of such series and provide either that the specific terms of Securities of such series, or any Tranche thereof,
shall be specified in a Company Order or that such terms shall be determined by the Company or its agents in accordance with procedures
specified in a Company Order as contemplated by the third paragraph of Section 303.
Unless otherwise specified
with respect to a series of Securities pursuant to paragraph (2) of this Section, any limit upon the aggregate principal amount of a series
of Securities may be increased without the consent of any Holders and additional Securities of such series may be authenticated and delivered
up to the limit upon the aggregate principal amount authorized with respect to such series as so increased.
Section 302. Denominations.
The Securities of each series shall be issuable in registered or unregistered form with or without coupons in such denominations as shall
be specified as contemplated by Section 301. In the absence of any such provisions with respect to the Securities of any series,
the Registered Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof and the Unregistered
Securities of the series shall be issuable in denominations of $5,000 and any integral multiple thereof.
Section 303. Execution,
Authentication, Delivery and Dating. The Securities shall be executed on behalf of the Company by its Chairman of the Board and Chief
Executive Officer, its President, its Senior Vice President, Finance, or its Treasurer, under its corporate seal reproduced thereon attested
by its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the Securities may be manual or facsimile.
The coupons, if any, of Unregistered Securities shall bear the manual or facsimile signature of any one of the officers or assistant officers
referred to in the first sentence of this Section.
Securities bearing the manual
or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding
that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did
not hold such offices at the date of such Securities.
At any time and from time
to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to
the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, and the Trustee
in accordance with the Company Order shall authenticate and deliver such Securities provided, however, that, with respect to Securities
of a series subject to a Periodic Offering, (a) such Company Order may be delivered by the Company to the Trustee prior to the delivery
to the Trustee of such Securities for authentication and delivery, (b) the Trustee shall authenticate and deliver Securities of such series
for original issue from time to time, in an aggregate principal amount not exceeding the aggregate principal amount established for such
series, all pursuant to a Company Order or pursuant to such procedures acceptable to the Trustee as may be specified from time to time
by a Company Order, (c) the maturity date or dates, original issue date or dates, interest rate or rates and any other terms of Securities
of such series shall be determined by Company Order or pursuant to such procedures and (d) if provided for in such procedures, such Company
Order may authorize authentication and delivery pursuant to oral or electronic instructions from the Company or its duly authorized agent
or agents, which oral instructions shall be promptly confirmed in writing.
In authenticating such Securities,
and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating:
(a) that such form
of Securities has been established in conformity with the provisions of this Indenture;
(b) that such terms
have been established in conformity with the provisions of this Indenture; and
(c) that such Securities,
when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms,
subject to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors’ rights
generally and to general equity principles.
Notwithstanding the provisions
of Section 301 and of the preceding paragraphs, if all Securities of a series are not to be originally issued at one time, it shall
not be necessary to deliver the Officer’s Certificate otherwise required pursuant to Section 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraphs at or prior to the time of authentication of each Security
of such series if such documents are delivered at or prior to the authentication upon original issuance of the first Security of such
series to be issued.
If such form or terms have
been so established, the Trustee shall not be required to authenticate such Securities if the issuance of such Securities pursuant to
this Indenture will affect the Trustee’s own rights, duties or immunities under the Securities and this Indenture or otherwise in
a manner which is not reasonably acceptable to the Trustee.
Each Registered Security shall
be dated the date of its authentication and each Unregistered Security shall be dated the date of its original issuance.
No Security shall be entitled
to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication
substantially in the form provided for herein executed by the Trustee by manual signature and no coupon shall be valid until the Security
to which it appertains has been so authenticated, and such certificate upon any Security shall be conclusive evidence, and the only evidence,
that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture.
Notwithstanding the foregoing,
until the Company has delivered an Officer’s Certificate to the Trustee and the Security Registrar stating that, as a result of
the action described, the Company would not suffer adverse consequences under the provisions of United States law or regulations in effect
at the time of the delivery of Unregistered Securities, the Trustee or the Security Registrar will (i) deliver Unregistered Securities
only outside the United States and its possessions and (ii) release Unregistered Securities in definitive form to the person entitled
to physical delivery thereof only upon presentation of a certificate in the form prescribed by the Company.
Section 304. Temporary
Securities. Pending the preparation of definitive Registered Securities of any series (including Global Securities), the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Registered Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Registered
Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as evidenced by their execution of such Securities. Every temporary Registered Security
shall be executed by the Company and authenticated by the Trustee, and registered by the Security Registrar, upon the same conditions,
and with like effect, as a definitive Registered Security.
If temporary Securities of
any series are issued, the Company will cause definitive Registered Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Registered Securities of such series, the temporary Registered Securities of such series shall be
exchangeable for definitive Registered Securities of such series upon surrender of the temporary Registered Securities of such series
at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation
of any one or more temporary Registered Securities of any series the Company shall execute and the Trustee shall authenticate and deliver
in exchange therefor a like principal amount of definitive Registered Securities of the same series of authorized denominations. Until
so exchanged the temporary Registered Securities of any series shall in all respects be entitled to the same benefits under this Indenture
as definitive Registered Securities of such series.
Until definitive Unregistered
Securities of any series (including Global Securities) are ready for delivery, the Company may prepare and execute and the Trustee shall
authenticate one or more temporary Unregistered Securities, which may have coupons attached or which may be in the form of one or more
temporary Global Unregistered Securities of that series without coupons. The temporary Unregistered Security or Securities of any series
shall be substantially in the form approved by or pursuant to a Board Resolution and shall be delivered to one of the Paying Agents located
outside the United States and its possessions or to such other person or persons as the Company shall direct against such certification
as the Company may from time to time prescribe by or pursuant to a Board Resolution. The temporary Unregistered Security or Securities
of a series shall be executed by the Company and authenticated by the Trustee upon the same conditions, and with like effect, as a definitive
Unregistered Security of such series, except as provided herein or in the Board Resolution or supplemental Indenture relating thereto.
A temporary Unregistered Security or Securities shall be exchangeable for definitive Unregistered Securities at the time and on the conditions,
if any, specified in the temporary Security.
Upon any exchange of a part
of a temporary Unregistered Security of a series for definitive Unregistered Securities of such series, the temporary Unregistered Security
shall be endorsed by the Trustee or Paying Agent to reflect the reduction of its principal amount by an amount equal to the aggregate
principal amount of the definitive Unregistered Securities of such series so exchanged and endorsed.
Section 305. Registration,
Registration of Transfer and Exchange. The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register
(the register maintained in such office and in any other office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee is hereby appointed
“Security Registrar” for the purpose of registering Securities and transfers of Securities as herein provided.
Except in the case of Securities
issued in the form of a Global Security, upon surrender for registration of transfer of any Registered Security of any series at the office
or agency of the Company in a Place of Payment for that series, the Company shall execute, and the Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new Registered Securities of the same series, of any authorized denominations
and of a like aggregate principal amount.
If both Registered and Unregistered
Securities are authorized for a series of Securities and the terms of such Securities permit, (i) Unregistered Securities may be exchanged
for an equal principal amount of Registered or Unregistered Securities of the same series and date of maturity in any authorized denominations
upon delivery to the Security Registrar (or a Paying Agent (as herein defined), if the exchange is for Unregistered Securities) of the
Unregistered Security with all unmatured coupons and all matured coupons in default appertaining thereto and if all other requirements
of the Security Registrar (or such Paying Agent) and such Securities for such exchange are met, and (ii) Registered Securities, other
than Securities issued in the form of a Global Security (except as provided in Section 311), may be exchanged for an equal principal
amount of Unregistered Securities of the same series and date of maturity in any authorized denominations (except that any coupons appertaining
to such Unregistered Securities which have matured and have been paid shall be detached) upon delivery to the Security Registrar of the
Registered Securities and if all other requirements of the Security Registrar and such Securities for such exchange are met.
Notwithstanding the foregoing,
the exchange of Unregistered Securities for Registered Securities or Registered Securities for Unregistered Securities will be subject
to the satisfaction of the provisions of United States law and regulations in effect at the time of such exchange, and no exchange of
Registered Securities for Unregistered Securities will be made until the Company has notified the Trustee in an Officer’s Certificate
and the Security Registrar that, as a result of such exchange, the Company would not suffer adverse consequences under such law or regulations.
All Securities issued upon
any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.
Every Security presented or
surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by the Holder
thereof or his attorney duly authorized in writing.
Unless otherwise provided
in a Board Resolution or an Officer’s Certificate pursuant to a Board Resolution, or in an indenture supplemental hereto, with respect
to Securities of any series, or any Tranche thereof, no service charge shall be made to the Holder for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may
be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304,
906 or 1106 not involving any transfer.
The Company shall not be required
(i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days
before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 1103
and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Security so selected
for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part. Unregistered Securities or any
coupons appertaining thereto shall be transferable by delivery thereof.
Section 306. Mutilated,
Destroyed, Lost and Stolen Securities. If any mutilated Security or a Security with a mutilated coupon or coupons appertaining to
it is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a replacement
Registered Security, if such surrendered security was a Registered Security, or a replacement Unregistered Security with coupons corresponding
to the coupons appertaining to the surrendered Security, if such surrendered Security was an Unregistered Security, of the same series
and of like tenor and principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered
to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security or any coupon or coupons
appertaining thereto, and (ii) such bond, security or indemnity as may be required by them to save each of them and any agent of either
of them harmless, then, in the absence of actual notice to the Company or the Trustee that such Security or any coupon or coupons appertaining
thereto has been acquired by a bona fide purchaser, the Company shall execute and upon its request the Trustee shall authenticate and
deliver, a replacement Registered Security, if such Holder’s claim pertains to a Registered Security, or a replacement Unregistered
Security with coupons corresponding to the coupons appertaining to the destroyed, lost or stolen Unregistered Security or the Unregistered
Security to which such destroyed, lost or stolen coupon or coupons appertains, if such Holder’s claim pertains to an Unregistered
Security, of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated,
destroyed, lost or stolen Security or any coupon or coupons appertaining thereto has become or is about to become due and payable, the
Company in its discretion may, instead of issuing a new Security, pay such Security or any coupon or coupons appertaining thereto.
Upon the issuance of any new
Security under this Section or any coupon or coupons appertaining thereto, the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses
of the Trustee) connected therewith.
Every new Security or any
coupon or coupons appertaining thereto of any series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security
or any coupon or coupons appertaining thereto shall constitute an original additional contractual obligation of the Company, whether or
not the destroyed, lost or stolen Security or any coupon or coupons appertaining thereto is at any time enforceable by anyone, and shall
be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities or any coupon or coupons
appertaining thereto of that series duly issued hereunder.
The provisions of this Section
are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities or any coupon or coupons appertaining thereto.
Section 307. Payment of
Interest; Interest Rights Preserved. Unless otherwise provided as contemplated by Section 301 with respect to the Securities
of any series, or any Tranche thereof, interest on any Registered Security that is payable, and is punctually paid or duly provided for,
on any Interest Payment Date shall be paid to the Person in whose name that Registered Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such interest. In case an Unregistered Security of any series is
surrendered in exchange for a Registered Security of such series after the close of business (at an office or agency of the Company in
a Place of Payment for such series) on any Regular Record Date and before the opening of business (at such office or agency) on the next
succeeding Interest Payment Date, such Unregistered Security shall be surrendered without the coupon relating to such Interest Payment
Date and interest will not be payable on such Interest Payment Date in respect of the Registered Security issued in exchange for such
Unregistered Security, but will be payable only to the Holder of such coupon when due in accordance with provisions of this Indenture.
Any interest on any Registered
Security of any series that is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called “Defaulted
Interest”) shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been
such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in clause (1) or (2) below:
(1) The Company
may elect to make payment of any Defaulted Interest to the Persons in whose names the Registered Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Registered Security of such series and the date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held
in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix
a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior
to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause
notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid,
to each Holder of Registered Securities of such series at the address of such Holder as it appears in the Security Register, not less
than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Registered Securities of such
series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer
be payable pursuant to the following clause (2). In case an Unregistered Security of any series is surrendered at the office or agency
of the Company in a Place of Payment for such series in exchange for a Registered Security of such series after the close of business
at such office or agency on any Special Record Date and before the opening of business at such office or agency on the related proposed
date for payment of Defaulted Interest, such Unregistered Security shall be surrendered without the coupon relating to such proposed date
of payment and Defaulted Interest will not be payable on such proposed date of payment in respect of the Registered Security issued in
exchange for such Unregistered Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions
of this Indenture.
(2) The Company
may make payment of any Defaulted Interest on the Registered Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange,
if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Trustee.
Subject to the foregoing provisions
of this Section, each Registered Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu
of any other Registered Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other
Registered Security.
Subject to the limitations
set forth in Section 1002, the Holder of any coupon appertaining to an Unregistered Security shall be entitled to receive the interest
payable on such coupon upon presentation and surrender of such coupon on or after the Interest Payment Date of such coupon at an office
or agency maintained for such purpose pursuant to Section 1002.
Section 308. Persons Deemed
Owners. Prior to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any agent of
the Company or the Trustee may treat the Person in whose name such Registered Security is registered as the owner of such Registered Security
for the purpose of receiving payment of principal of (and premium, if any) and (subject to Section 301 and Section 307)
interest, if any, on such Registered Security and for all other purposes whatsoever, whether or not such Registered Security be overdue,
and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.
Ownership of Registered Securities
of a series shall be proved by the computerized book-entry system of the Depository in the case of Registered Securities issued in the
form of a Global Security. Ownership of Unregistered Securities may be proved by the production of such Unregistered Securities or by
a certificate or affidavit executed by the person holding such Unregistered Securities or by a depository with whom such Unregistered
Securities were deposited, if the certificate or affidavit is satisfactory to the Trustee and the Company. The Company, the Trustee and
any agent of the Company may treat the bearer of any Unregistered Security or coupon and the person in whose name a Registered Security
is registered as the absolute owner thereof for all purposes.
None of the Company, the Trustee,
any Paying Agent or the Security Registrar will have any responsibility or liability for any aspect of the records relating to or payments
made on account of beneficial ownership interests of a Global Security or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
Section 309. Cancellation.
Except as otherwise specified as contemplated by Section 301 for Securities of any series, all Securities and coupons surrendered
for payment, redemption, registration of transfer or exchange or for credit against any sinking fund payment shall, if surrendered to
any Person other than the Trustee, be delivered to the Trustee and, if not theretofore cancelled, shall be promptly cancelled by it. Except
as otherwise specified as contemplated by Section 301 for Securities of any series, the Company may at any time deliver to the
Trustee for cancellation any Securities or coupons previously authenticated and delivered hereunder that the Company may have acquired
in any manner whatsoever or that the Company has not issued and sold, and all Securities or coupons so delivered shall be promptly cancelled
by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities or coupons cancelled as provided in
this Section, except as expressly permitted by this Indenture. All cancelled Securities or coupons held by the Trustee shall be destroyed
and the Trustee shall furnish an affidavit to the Company (setting forth the serial numbers of such Securities) attesting to such destruction
unless by a Company Order the Company shall direct that the cancelled Securities or coupons be returned to it.
Section 310. Computation
of Interest. Except as otherwise specified as contemplated by Section 301 for Securities of any series, interest on the Securities
of each series shall be computed on the basis of a year of twelve 30-day months.
Section 311. Global Securities;
Exchanges; Registration and Registration of Transfer.
If specified as contemplated by Section 301, the Securities may be issued in the form of one or more Global Securities, which shall
be deposited with the Depository, and, unless otherwise specified in the form of Global Security adopted pursuant to Section 301,
be registered in the name of the Depository’s nominee.
Except as otherwise specified
as contemplated by Section 301, any permanent Global Security shall be exchangeable only as provided in this paragraph. If the
beneficial owners of interests in a permanent Global Security are entitled to exchange such interests for Securities of such series of
like tenor and principal amount of another authorized form, as specified as contemplated by Section 301, then without unnecessary
delay but in any event not later than the earliest date on which such interests may be so exchanged, the Company shall deliver to the
Trustee definitive Securities of that series in aggregate principal amount equal to the principal amount of such permanent Global Security,
executed by the Company. On or after the earliest date on which such interests may be so exchanged, such permanent Global Security shall
be surrendered from time to time in accordance with instructions given to the Trustee and the Depository (which instructions shall be
in writing but need not comply with Section 102 or be accompanied by an Opinion of Counsel) by the Depository or such other depository
as shall be specified in the Company Order with respect thereto to the Trustee, as the Company’s agent for such purpose, to be exchanged,
in whole or in part, for definitive Securities of the same series without charge and the Trustee shall authenticate and deliver, in exchange
for each portion of such permanent Global Security, a like aggregate principal amount of definitive Securities of the same series of authorized
denominations and of like tenor as the portion of such permanent Global Security to be exchanged which, unless the Securities of the series
are not issuable both as Unregistered Securities and as Registered Securities, as specified as contemplated by Section 301, shall
be in the form of Unregistered Securities or Registered Securities, or any combination thereof, as shall be specified by the beneficial
owner thereof; provided, however, that no such exchanges may occur during the periods specified by Section 305; and
provided, further, that no Unregistered Security delivered in exchange for a portion of a permanent Global Security shall
be mailed or otherwise delivered to any location in the United States unless the Company has complied with the fourth paragraph of Section
305. Promptly following any such exchange in part, such permanent Global Security shall be returned by the Trustee, to the Depository
or such other depository referred to above, in accordance with the instructions of the Company referred to above.
The Global Security may be
transferred to another nominee of the Depository, or to a successor Depository selected by the Company, and upon surrender for registration
of transfer of the Global Security to the Trustee, the Company shall execute, and the Trustee shall authenticate and deliver, in the name
of the designated transferee, a new Global Security in the same aggregate principal amount. If at any time the Depository notifies the
Company that it is unwilling or unable to continue as Depository and a successor Depository satisfactory to the Company is not appointed
within 90 days after the Company receives such notice, the Company will execute, and the Trustee will authenticate and deliver, Securities
in definitive form to the Depository in exchange for the Global Security. In addition, if at any time the Company determines that it is
not in the best interest of the Company or the beneficial owners of Securities to continue to have a Global Security representing all
of the Securities held by a Depository, the Company may, at its option, execute, and the Trustee will authenticate and deliver, Securities
in definitive form to the Depository in exchange for all or a portion of the Global Security. Promptly after any such exchange of Securities
in definitive form for all or a portion of the Global Security pursuant to this paragraph, the Company shall promulgate regulations governing
registration of transfers and exchanges of Securities in definitive form, which regulations shall be reasonably satisfactory to the Trustee
and shall thereafter bind every Holder of such Securities.
Section 312. Extension
of Interest Payment. The Company shall have the right at any time, so long as the Company is not in default in the payment of interest
on the Securities of any series hereunder, to extend interest payment periods on all Securities of one or more series, if so specified
as contemplated by Section 301 with respect to such Securities and upon such terms as may be specified as contemplated by Section
301 with respect to such Securities. If the Company ever so extends any such interest payment period, the Company shall promptly notify
the Trustee.
ARTICLE
IV
SATISFACTION AND DISCHARGE
Section 401. Satisfaction
and Discharge of Indenture. (a) This Indenture shall upon Company Request cease to be of further effect (except as to any surviving
rights of registration of transfer or exchange of Securities herein expressly provided for), and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities
theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 306 and (ii) Securities that are deemed paid and discharged pursuant to Section 403) have
been delivered to the Trustee for cancellation; or
(B) all such Securities
not theretofore delivered to the Trustee for cancellation
(i) have become due
and payable, or
(ii) will become due
and payable at their Stated Maturity within one year, or
(iii) are to be called
for redemption pursuant to Article XI hereof under arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company, or
(iv) are deemed paid
and discharged pursuant to Section 403, as applicable,
and the Company, in the case of clause
(i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount
of (a) money, or (b) (I) Eligible Obligations which through the payment of interest and principal in respect thereof in accordance with
their terms will provide on or before the Stated Maturity or Redemption Date, as the case may be, money in an amount, or (II) a combination
of money or Eligible Obligations as provided in clause (I) above, in each case sufficient, in the opinion of a nationally recognized firm
of independent certified public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge
the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal (and premium, if any)
and interest, if any, to the date of such deposit (in the case of Securities that have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be;
(2) the Company
has paid or caused to be paid all other sums payable hereunder by the Company; and
(3) the Company
has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have been met.
Notwithstanding the satisfaction
and discharge of this Indenture, the obligations of the Company to the Trustee under Section 607, the obligations of the Trustee
to any Authenticating Agent under Section 614 and, if money or Eligible Obligations have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section or if money or Eligible Obligations shall have been deposited with or received by the Trustee
pursuant to Section 403, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003
shall survive.
(b) Upon satisfaction and discharge
of this Indenture as provided in this Section 401, the Trustee shall assign, transfer and turn over to the Company, subject to
the lien provided by Section 607, any and all money, securities and other property then held by the Trustee for the benefit of
the Holders of the Securities other than money and Eligible Obligations held by the Trustee pursuant to Section 402.
Section 402. Application
of Trust Money. (a) Neither the Eligible Obligations nor the money deposited with the Trustee pursuant to Section 403(e), nor
the principal or interest payments on any such Eligible Obligations, shall be withdrawn or used for any purpose other than, and shall
be held in trust for, the payment of the principal of and premium, if any, and interest, if any, on the Securities or portions of principal
amount thereof in respect of which such deposit was made, all subject, however, to the provisions of Section 1003; provided,
however, that, so long as there shall not have occurred and be continuing an Event of Default, any cash received from such principal
or interest payments on such Eligible Obligations deposited with the Trustee, if not then needed for such purpose, shall, to the extent
practicable, be invested in Eligible Obligations of the type described in Section 403(e)(2)(A) maturing at such times and in such
amounts as shall be sufficient to pay when due the principal of and premium, if any, and interest, if any, due and to become due on such
Securities or portions thereof on and prior to the Maturity thereof, and interest earned from such reinvestment shall be paid over to
the Company as received by the Trustee, free and clear of any trust, lien or pledge under this Indenture except the lien provided by Section
607; and provided, further, that, so long as there shall not have occurred and be continuing an Event of Default, any moneys
held by the Trustee in accordance with this Section on the Maturity of all such Securities in excess of the amount required to pay the
principal of and premium, if any, and interest, if any, then due on such Securities shall be paid over to the Company free and clear of
any trust, lien or pledge under this Indenture except the lien provided by Section 607.
(b) The Company shall pay and
shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against Eligible Obligations deposited pursuant
to Section 401, 403 or 1007 or the interest and principal received in respect of such obligations other than any
payable by or on behalf of Holders.
Section 403. Satisfaction,
Discharge and Defeasance of Securities of Any Series. The Company shall be deemed to have paid and discharged the entire indebtedness
on all the Outstanding Securities of any series or Tranche, or any portion of the principal amount thereof, on the 91st day after the
date of the deposit referred to in subparagraph (e) hereof, and the provisions of this Indenture, as it relates to such Outstanding Securities
of such series, shall be satisfied and discharged and shall no longer be in effect (and the Trustee, at the expense of the Company, shall
at Company Request execute proper instruments acknowledging the same), except as to:
(a) the rights of
Holders of Securities of such series to receive, solely from the trust funds described in subparagraph (e) hereof, (i) payment of the
principal of (and premium, if any) and each installment of principal of (and premium, if any) or interest, if any, on the Outstanding
Securities of such series, or portions thereof, on the Stated Maturity of such principal or installment of principal or interest or to
and including the Redemption Date irrevocably designated by the Company pursuant to subparagraph (k) hereof and (ii) the benefit of any
mandatory sinking fund payments applicable to the Securities of such series on the day on which such payments are due and payable in accordance
with the terms of this Indenture and the Securities of such series;
(b) the obligations
of the Company and the Trustee with respect to such Securities of such series under Sections 304, 305, 306, 614, 1002, 1003
and 1203 and, if the Company shall have irrevocably designated a Redemption Date pursuant to subparagraph (k) hereof, Sections
1104 and 1106; and
(c) the Company’s
obligations with respect to the Trustee under Section 607;
provided that, the following conditions
shall have been satisfied:
(d) the Company
has deposited or caused to be irrevocably deposited (except as provided in Section 402) with the Trustee as trust funds in trust,
specifically pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities of such series, (i) money
in an amount, or (ii) (A) Eligible Obligations which through the payment of interest and principal in respect thereof in accordance with
their terms will provide on or before the due date of any payment referred to in clause (x) or (y) of this subparagraph (e) money in an
amount or (B) a combination thereof, sufficient, in the opinion of a nationally recognized firm of independent certified public accountants
expressed in a written certification thereof delivered to the Trustee, to pay and discharge (x) the principal of (and premium, if any)
and each installment of principal (and premium, if any) and interest, if any, on such Securities on the Stated Maturity of such principal
or installment of principal or interest or to and including the Redemption Date irrevocably designated by the Company pursuant to subparagraph
(k) hereof and (y) any mandatory sinking fund payments applicable to the Securities of such series on the day on which such payments are
due and payable in accordance with the terms of this Indenture and of the Securities of such series;
(e) such deposit
will not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which
the Company is a party or by which it is bound;
(f) such provision
would not cause any Outstanding Securities of such series then listed on the New York Stock Exchange or other securities exchange to be
delisted as a result thereof;
(g) no Event of
Default or event that with notice or lapse of time would become an Event of Default with respect to the Securities of such series has
occurred and is continuing on the date of such deposit or during the period ending on the 91st day after such date;
(h) the Company
has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel to the effect that (x) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling or (y) there has been a change in law or regulation occurring
after the date hereof, to the effect that Holders of the Securities of such series will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit, defeasance and discharge and will be subject to federal income tax on the same amount
and in the same manner and at the same times, as would have been the case if such deposit, defeasance and discharge had not occurred;
(i) the Company
has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided
for relating to the defeasance contemplated by this Section have been complied with; and
(j) if the Company
has deposited or caused to be deposited money or Eligible Obligations to pay or discharge the principal of (and premium, if any) and interest
on the Outstanding Securities of a series to and including a Redemption Date pursuant to subparagraph (e) hereof, such Redemption Date
shall be irrevocably designated by a Board Resolution delivered to the Trustee on or prior to the date of deposit of such money or Eligible
Obligations, and such Board Resolution shall be accompanied by an irrevocable Company Request that the Trustee give notice of such redemption
in the name and at the expense of the Company not less than 30 nor more than 60 days prior to such Redemption Date in accordance with
Section 1104.
ARTICLE
V
REMEDIES
Section 501. Events of
Default. “Event of Default”, wherever used herein with respect to Securities of any series, means any one
of the following events:
(1) default in the
payment of any interest upon any Security of that series when it becomes due and payable, and continuance of such default for a period
of 30 days; provided, however, that a valid extension of the interest payment period by the Company as contemplated in Section
312 shall not constitute a failure to pay interest for this purpose; or
(2) default in the
payment of the principal of (or premium, if any, on) any Security of that series at its Maturity; or
(3) default in the
deposit of any sinking fund payment, when and as due by the terms of a Security of that series; or
(4) default in the
performance, or breach, of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture
solely for the benefit of one or more series of Securities other than that series), and continuance of such default or breach for a period
of 60 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of such series a written notice specifying
such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default”
hereunder; or
(5) the entry by
a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company in an involuntary case or proceeding
under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition
of or in respect of the Company under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding up
or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and
in effect for a period of 60 consecutive days; or
(6) the commencement
by the Company of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other
similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree
or order for relief in respect of the Company in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by
it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of the Company or of any substantial part of its property, or the making by it of an assignment for the
benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due, or the taking
of corporate action by the Company in furtherance of any such action; or
(7) any other Event
of Default provided with respect to Securities of such series as contemplated by Sections 301 and 901(3).
Section 502. Acceleration
of Maturity; Rescission and Annulment. If an Event of Default with respect to any series or Tranche of Senior Securities at the time
Outstanding occurs and is continuing, then, unless the principal of and interest on such series or Tranche of Senior Securities has already
become due and payable, either the Trustee or the Holders of a majority in aggregate principal amount of such series or Tranche of Senior
Securities then outstanding, by notice in writing to the Company (and to the Trustee if given by such Holders), may declare the principal
of and interest on all the Senior Securities of such series or Tranche (or if any of the Senior Securities are Original Issue Discount
Securities or Indexed Securities, such portion of the principal amount of such Securities as may be specified in the terms thereof) to
be due and payable immediately and upon any such declaration the same shall become immediately due and payable, anything in this Indenture
or in the Senior Securities of such series or Tranche contained to the contrary notwithstanding; provided, however, that
if an Event of Default has occurred and is continuing with respect to more than one series or Tranche of Senior Securities, the Trustee
or the Holders of a majority in aggregate principal amount of the Outstanding Senior Securities (or if any of the Senior Securities are
Original Issue Discount Securities or Indexed Securities, such portion of the principal amount of such Securities as may be specified
in the terms thereof) of all such series or Tranches (voting as one class) may make such declaration of acceleration, and not the Holders
of the Senior Securities of any one of such series or Tranches.
If an Event of Default with
respect to any series or Tranche of Subordinated Securities at the time Outstanding occurs and is continuing, then, unless the principal
of and interest on such series or Tranche of Subordinated Securities has already become due and payable, either the Trustee or the Holders
of a majority in aggregate principal amount of the Subordinated Securities of such series or Tranche then outstanding, by notice in writing
to the Company (and to the Trustee if given by such Holders), may declare the principal of and interest on all the Subordinated Securities
of such series or Tranche (or if any of the Subordinated Securities are Original Issue Discount Securities or Indexed Securities, such
portion of the principal amount of such Securities as may be specified in the terms thereof) to be due and payable immediately and upon
any such declaration the same shall become immediately due and payable, anything in this Indenture or in the Subordinated Securities of
such series contained to the contrary notwithstanding; provided, however, that if an Event of Default has occurred and is
continuing with respect to more than one series or Tranche of Subordinated Securities, the Trustee or the Holders of a majority in aggregate
principal amount of the Outstanding Subordinated Securities (or if any of the Subordinated Securities are Original Issue Discount Securities
or Indexed Securities, such portion of the principal amount of such Securities as may be specified in the terms thereof) of all such series
or Tranche (voting as one class) may make such declaration of acceleration, and not the Holders of the Subordinated Securities of any
one of such series or Tranches.
In the case of any declaration
of acceleration of the Stated Maturity of any Original Issue Discount Securities or Indexed Securities of a series, the Company shall
furnish the Trustee with an Officer’s Certificate stating the amount of principal to be paid to a Holder of $1,000 principal amount
of such Securities.
At any time after such a declaration
of acceleration with respect to Securities of any series has been made and before a judgment or decree for payment of the money due has
been obtained by the Trustee as hereinafter in this Article provided, the Event or Events of Default giving rise to such declaration of
acceleration shall, without further act, be deemed to have been waived, and such declaration and its consequences shall, without further
act, be deemed to have been rescinded and annulled, if
(1) the Company
has paid or deposited with the Trustee a sum sufficient to pay
(A) all overdue interest
on all Securities of any such series,
(B) the principal
of (and premium, if any, on) any Securities of such series that have become due otherwise than by such declaration of acceleration and
interest thereon at the rate or rates prescribed therefor in such Securities,
(C) to the extent
that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Securities, and
(D) all amounts due
to the Trustee under Section 607;
and
(2) all Events of
Default with respect to Securities of that series, other than the non-payment of the principal of Securities of that series that have
become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513.
No such rescission shall affect
any subsequent Event of Default or impair any right consequent thereon.
Section 503. Collection
of Indebtedness and Suits for Enforcement by Trustee. If an Event of Default described in clause (1) or (2) of Section 501
has occurred and is continuing, the Company shall, upon demand of the Trustee, pay to it, for the benefit of the Holders of the Securities
of the series with respect to which such Event of Default has occurred, the whole amount then due and payable on such Securities for principal
(and premium, if any) and interest, if any, and, to the extent that payment of such interest shall be legally enforceable, interest on
any overdue principal (and premium, if any) and on any overdue interest, at the rate or rates prescribed therefor in such Securities,
and, in addition thereto, such further amount as shall be sufficient to cover any amounts due to the Trustee under Section 607.
If the Company fails to pay
such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding
for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against
the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such Securities, wherever situated.
If an Event of Default with
respect to Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights
and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as the Trustee deems most effectual
to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper remedy.
Section 504. Trustee
May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property
of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall
then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any
demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,
(i) to file
and prove a claim for the whole amount of principal (and premium, if any) and interest, if any, owing and unpaid in respect of the Securities
and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any
claim for amounts due to the Trustee under Section 607 and of the Holders allowed in such judicial proceeding, and
(ii) to collect
and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder
to make such payments to the Trustee and, if the Trustee consents to the making of such payments directly to the Holders, to pay to the
Trustee any amount due it under Section 607.
Nothing herein contained shall
be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
Section 505. Trustee
May Enforce Claims Without Possession of Securities or Coupons. All rights of action and claims under this Indenture or the Securities
or coupons may be prosecuted and enforced by the Trustee without the possession of any of the Securities or coupons or the production
thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the payment of the amounts due to the Trustee under Section
607, be for the ratable benefit of the Holders of the Securities and coupons in respect of which such judgment has been recovered.
Section 506. Application
of Money Collected. Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date
or dates fixed by the Trustee, and, in case of the distribution of such money on account of principal (or premium, if any) or interest,
if any, upon presentation of the Securities in respect of which or for the benefit of which such money shall have been collected and the
notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all
amounts due the Trustee under Section 607;
SECOND: To the payment of the
amounts then due and unpaid for principal of (and premium, if any) and interest, if any, on the Securities in respect of which or for
the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal (and premium, if any) and interest, if any, respectively; and
THIRD: The balance, if any,
to the Company.
The Trustee may fix a record
date (with respect to Registered Securities) and payment date for any such payment to Holders of Securities.
Section 507. Limitation
on Suits. No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such
Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series;
(2) the
Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of all series of Senior Securities in
respect of which an Event of Default has occurred and is continuing, considered as one class, shall have made written request to the Trustee
to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder if such holder is a Holder of Senior
Securities or the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of all series of Subordinated
Securities in respect of which an Event of Default has occurred and is continuing, considered as one class, shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder if such Holder is a Holder
of Subordinated Securities;
(3) such
Holder or Holders have offered to the Trustee indemnity against the reasonable costs, expenses and liabilities to be incurred in compliance
with such request;
(4) the
Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and
(5) no
direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority
in aggregate principal amount of the Outstanding Securities of all series;
it being understood and intended
that (subject to Section 508) no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing
of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all of such Holders.
Section 508. Unconditional
Right of Holders to Receive Principal, Premium and Interest. Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 307) interest, if any, on such Security on the Stated Maturity or Maturities expressed in such Security (or,
in the case of redemption, on the Redemption Date, or, in the case of repayment at the option of the Holder, on the Repayment Date) and
to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.
Section 509. Restoration
of Rights and Remedies. If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and such Holder shall be restored
severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and such Holder shall
continue as though no such proceeding had been instituted.
Section 510. Rights
and Remedies Cumulative. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities in the last paragraph of Section 306, no right or remedy herein conferred upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment
of any other appropriate right or remedy.
Section 511. Delay or
Omission Not Waiver. No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing
upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and
as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
Section 512. Control
by Holders. If an Event of Default shall have occurred and be continuing in respect of a series of Securities, the Holders of a majority
in aggregate principal amount of the Outstanding Securities of such series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect
to the Securities of such series or Tranche; provided, however, that if an Event of Default has occurred and is continuing with
respect to more than one series of Senior Securities, the Holders of a majority in aggregate principal amount of the Outstanding Securities
of all such series, considered as one class, shall have the right to make such direction, an not the Holders of the Senior Securities
of any one of such series, and if an Event of Default has occurred and is continuing with respect to more than one series of Subordinated
Securities, the Holders of a majority in aggregate principal amount of all such series, considered as one class, shall have the right
to make such direction, and not the Holders of the Subordinated Securities of any one of such series; provided, further that
(1) such
direction shall not be in conflict with any rule of law or with this Indenture, and
(2) the
Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.
Section 513. Waiver
of Past Defaults. The Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of any series
may on behalf of the Holders of all the Securities of such series waive any past default hereunder with respect to such series and its
consequences; provided that if any such past default has occurred with respect to more than one series of Senior Securities, the
Holders of a majority in aggregate principal amount of the Outstanding Securities of all such series, considered as one class, may make
such waiver, and not the Holders of any one of such series; provided further that if any such past default has occurred with respect
to more than one series of Subordinated Securities, the Holders of a majority in aggregate principal amount of the Outstanding Securities
of all such series, considered as one class, may make such waiver, and not the Holders of any one of such series, in each case except
a default
(1) in
the payment of the principal of (or premium, if any) or interest, if any, on any Security of such series, or
(2) in
respect of a covenant or provision hereof that under Section 902 cannot be modified or amended without the consent of the Holder
of each Outstanding Security of such series affected.
Upon any such waiver, such
default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.
Section 514. Undertaking
for Costs. All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or
in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit
of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable
attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted
by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in aggregate principal
amount of the Outstanding Securities of all series in respect of which such suit may be brought, considered as one class, or to any suit
instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any) or interest, if any, on any Security
on or after the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on or after the Redemption Date,
or, in the case of repayment at the option of the Holder, on or after the Repayment Date).
Section 515. Waiver
of Stay or Extension Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon,
or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE VI
THE TRUSTEE
Section 601. Certain
Duties and Responsibilities. (a) Except during the continuance of an Event of Default with respect to Securities of any series,
(1) the
Trustee undertakes to perform, with respect to Securities of such series, such duties and only such duties as are specifically set forth
in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
(2) in
the absence of bad faith on its part, the Trustee may, with respect to Securities of such series, conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform
to the requirements of this Indenture.
(b) If
an Event of Default with respect to Securities of any series has occurred and is continuing, the Trustee shall exercise, with respect
to Securities of such series, such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill
in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.
(c) No
provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure
to act, or its own wilful misconduct, except that
(1) this
subsection shall not be construed to limit the effect of sub-section (a) of this Section;
(2) the
Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the
Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction
of the Holders of a majority in aggregate principal amount of the Outstanding Securities of any one or more series, as provided herein,
relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture with respect to the Securities of such series; and
(4) no
provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it has reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
(d) Whether
or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 602. Notice
of Defaults. Within 90 days after the occurrence of any default hereunder with respect to the Securities of any series, the Trustee
shall transmit by mail to all Holders of Securities of such series entitled to receive reports pursuant to Section 704(3) (and,
if Unregistered Securities of that series are outstanding, shall cause to be published at least once in an Authorized Newspaper in The
City of New York and, if Securities of that series are listed on any stock exchange outside of the United States, in the city in which
such stock exchange is located) notice of such default hereunder known to the Trustee, unless such default shall have been cured or waived;
provided, however, that, except in the case of a default in the payment of the principal of (or premium, if any) or interest,
if any, on any Security of such series or in the payment of any sinking fund installment with respect to Securities of such series, the
Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee
of directors or Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of
the Holders of Securities of such series; and provided, further, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to Holders shall be given until at least 75 days after
the occurrence thereof. For the purpose of this Section, the term “default” means any event that is, or after
notice or lapse of time or both would become, an Event of Default with respect to Securities of such series.
Section 603. Certain
Rights of Trustee. Subject to the provisions of Section 601 and to the applicable provisions of the Trust Indenture Act:
(a) the
Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document reasonably
believed by it to be genuine and to have been signed or presented by the proper party or parties;
(b) any
request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order, or as otherwise
expressly provided herein, and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever
in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, rely upon an Officer’s Certificate or a certificate of an officer or officers delivered pursuant to Section 301
and such Officer’s Certificate or certificate of an officer or officers, in the absence of negligence or bad faith on the part of
the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this Indenture
upon the faith thereof;
(d) the
Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;
(e) the
Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction;
(f) the
Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document,
but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such further inquiry or investigation, it shall (subject to applicable legal requirements) be entitled
to examine, during normal business hours, the books, records and premises of the Company, personally or by agent or attorney; and
(g) the
Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys
and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care
by it hereunder; no Depository or Paying Agent shall be deemed an agent of the Trustee and the Trustee shall not be responsible for any
act or omission by any of them.
Section 604. Not Responsible
for Recitals or Issuance of Securities. The recitals contained herein and in the Securities, except the Trustee’s certificate
of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility
for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities of
any series or any coupons. The Trustee or any Authenticating Agent shall not be accountable for the use or application by the Company
of Securities or the proceeds thereof. The Trustee shall not be responsible for and makes no representations as to the Company’s
ability or authority to issue the Unregistered Securities or the lawfulness thereof.
Section 605. May Hold
Securities. The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company or the
Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 608 and
613, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other agent.
Section 606. Money Held
in Trust. Money held by the Trustee or by any Paying Agent (other than the Company if the Company shall act as Paying Agent) in trust
hereunder need not be segregated from other funds except to the extent required by law. Neither the Trustee nor any Paying Agent shall
be liable for interest on any money received by it hereunder except as expressly provided herein or otherwise agreed with the Company.
Section 607. Compensation
and Reimbursement. The Company agrees
(1) to
pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of an express trust);
(2) except
as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence,
wilful misconduct or bad faith; and
(3) to
indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense reasonably incurred without negligence, wilful
misconduct or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder
or performance of its duties hereunder, including the costs and expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder.
As security for the performance
of the obligations of the Company under this Section, the Trustee shall have a claim prior to the Securities and any coupons upon all
property and funds held or collected by the Trustee as such, except property and funds held in trust for the payment of principal of (and
premium, if any) or interest, if any, on particular Securities or any coupons.
Section 608. Disqualification;
Conflicting Interests. If the Trustee has or acquires any conflicting interest within the meaning of the Trust Indenture Act with
respect to the Securities of any series, it shall either eliminate such conflicting interest or resign to the extent, in the manner and
with the effect, and subject to the conditions, provided in the Trust Indenture Act and this Indenture. For purposes of Section 310(b)(1)
of the Trust Indenture Act and to the extent permitted thereby, the Trustee, in its capacity as trustee in respect of the equally ranked
and unsecured Securities of any series, shall not be deemed to have a conflicting interest arising from its capacity as trustee in respect
of the equally ranked and unsecured Securities of any other series under this Indenture or any securities issued under the Indenture dated
as of [ ] between the Company and the Trustee [specifically describe other outstanding indentures with the Trustee].
Section 609. Corporate
Trustee Required; Eligibility. There shall at all times be a Trustee hereunder that shall be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the District of Columbia (or such other Person as may be permitted
to act as Trustee by the Commission), authorized under such laws to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by federal or state authority and qualified and eligible under this Article,
provided that, neither the Company nor any Affiliate of the Company may serve as Trustee of any Securities. If such corporation
publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at any time the Trustee ceases to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.
Section 610. Resignation
and Removal; Appointment of Successor. (a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant
to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
(b) The
Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company. If
the instrument of acceptance by a successor Trustee required by Section 611 has not been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment
of a successor Trustee with respect to the Securities of such series.
(c) The
Company may at any time by a Board Resolution remove the Trustee with respect to the Securities of any or all series.
(d) The
Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in aggregate principal
amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company.
(e) If
at any time:
(1) the
Trustee fails to comply with Section 608 with respect to the Securities of any series, after written request therefor by the Company
or by any Holder who has been a bona fide Holder of a Security of such series for at least six months, or
(2) the
Trustee ceases to be eligible under Section 609 and fails to resign after written request therefor by the Company or by any such
Holder, or
(3) the
Trustee becomes incapable of acting or becomes adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property is appointed
or any public officer takes charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation
or liquidation,
then, in any such case, subject
to Section 514, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities
and the appointment of a successor Trustee or Trustees.
(f) If
the Trustee resigns, is removed or becomes incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees
with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect
to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities
of any particular series) and shall comply with the applicable requirements of Section 611. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series is appointed
by Act of the Holders of a majority in aggregate principal amount of the Outstanding Securities of such series delivered to the Company
and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with
the applicable requirements of Section 611, become the successor Trustee with respect to the Securities of such series and to that
extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Securities of any series
has been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 611, any Holder
who has been a bona fide Holder of a Security of such series for at least six months may, subject to Section 514, on behalf of
himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
(g) The
Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders of Securities of such series entitled to receive reports pursuant to Section 704(3) and, if any Unregistered
Securities are outstanding, by publishing notice of such event once in an Authorized Newspaper in The City of New York and, if any Unregistered
Securities are listed on any stock exchange outside of the United States, in the city in which such stock exchange is located. Each notice
shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office.
(h) All
provisions of this Section except subparagraph (d) and Section 611(b) (except for the last clause, after omitting the words “after
deducting all amounts owed to the retiring Trustee pursuant to Section 607,” which shall apply) shall apply also to any Paying
Agent located outside the United States and its possessions.
Section 611. Acceptance
of Appointment by Successor. (a) In case of the appointment hereunder of a successor Trustee with respect to the Securities of all
series, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of
the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder, subject
nevertheless to its lien provided for in Section 607.
(b) In
case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall
be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates,
(2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary
or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add
to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust
or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation
or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of the Company or
any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee, after deducting all amounts
owed to the retiring Trustee pursuant to Section 607, all property and money held by such retiring Trustee hereunder with respect
to the Securities of that or those series to which the appointment of such successor Trustee relates.
(c) Upon
request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be.
(d) No
successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 612. Merger,
Conversion, Consolidation or Succession to Business. Any corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing
of any paper or any further act on the part of any of the parties hereto. In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated
such Securities. In case any Securities shall not have been authenticated by such predecessor Trustee, any such successor Trustee may
authenticate and deliver such Securities, in either its own name or that of its predecessor Trustee, with the full force and effect which
this Indenture provides for the certificate of authentication of the Trustee.
Section 613. Preferential
Collection of Claims Against Company. The Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed
in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated
therein.
Section 614. Appointment
of Authenticating Agent. At any time when any of the Securities remain Outstanding the Trustee may appoint an Authenticating Agent
or Agents (which may include any Person that owns, directly or indirectly, all of the capital stock of the Trustee or a corporation that
is a wholly-owned subsidiary of the Trustee or of such other Person) with respect to one or more series of Securities, or any Tranche
thereof, that shall be authorized to act on behalf of the Trustee to authenticate Securities of such series or Tranche issued upon original
issuance, exchange, registration of transfer or partial redemption thereof or pursuant to Section 306, and Securities so authenticated
shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. The Trustee shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders of Securities
of the series or Tranche with respect to which such Authenticating Agent will serve, and which are entitled to receive reports pursuant
to Section 704(3) and, if any Unregistered Securities are outstanding, by publishing notice of such event once in an Authorized
Newspaper in The City of New York and, if any Unregistered Securities are listed on any stock exchange outside of the United States, in
the city in which such stock exchange is located. Wherever reference is made in this Indenture to the authentication and delivery of Securities
by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery
on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating
Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any state thereof or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $1,000,000 and subject to supervision or examination by federal or state
authority. If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent
shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time
an Authenticating Agent ceases to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section.
Any corporation into which
an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to the corporate agency
or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation
shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
An Authenticating Agent may
resign with respect to one or more series of Securities at any time by giving written notice thereof to the Trustee and to the Company.
The Trustee may at any time terminate the agency of an Authenticating Agent with respect to one or more series of Securities by giving
written notice thereof to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination,
or in case at any time such Authenticating Agent ceases to be eligible in accordance with the provisions of this Section, the Trustee
may appoint a successor Authenticating Agent that is acceptable to the Company and shall provide notice of such appointment to all Holders
of Securities of the series or Tranche with respect to which such Authenticating Agent will serve, as provided in paragraph (a) of this
Section. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers
and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section. An Authenticating Agent appointed pursuant to this Section
shall be entitled to rely on Sections 111, 308, 604 and 605 hereunder.
The Trustee agrees to pay
to each Authenticating Agent from time to time reasonable compensation for its services under this Section, and the Trustee shall be entitled
to be reimbursed for such payments, subject to the provisions of Section 607.
If an appointment with respect
to the Securities of one or more series, or any Tranche thereof, is made pursuant to this Section, the Securities of such series or Tranche
may have endorsed thereon, in addition to the Trustee’s certificate of authentication, an alternate certificate of authentication
in the following form:
This is one of the Securities
of the series designated pursuant to and issued under the within-mentioned Indenture.
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As Trustee
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By
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As Authenticating Agent on behalf of the Trustee
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By
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Authorized Officer of Authenticating Agent
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Dated: ________________
If all of the Securities of
a series may not be originally issued at one time, and if the Trustee does not have an office capable of authenticating Securities upon
original issuance located in a Place of Payment where the Company wishes to have Securities of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in writing (which writing need not comply with Section 102 and need not be
accompanied by an Opinion of Counsel), shall appoint, in accordance with this Section and in accordance with such procedures as shall
be acceptable to the Trustee, an Authenticating Agent (which, if so requested by the Company, may be an Affiliate of the Company) having
an office in a Place of Payment designated by the Company with respect to such series of Securities.
ARTICLE
VII
HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to
Furnish Trustee Names and Addresses of Holders. The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually,
not later than the 15th day after each Regular Record Date for each series of Registered Securities at the time Outstanding or on June
30 and December 31 of each year with respect to each series of Securities for which there are no Regular Record Dates, a list, in such
form as the Trustee may reasonably require, containing all the information in the possession or control of the Company, or any of its
Paying Agents other than the Trustee, of the names and addresses of the Holders of Registered Securities of such series, including Holders
of interests in Global Securities, as of such preceding Regular Record Date or on June 15 or December 15, as the case may be, or, in the
case of a series of non-interest bearing Securities, on a date to be determined as contemplated pursuant to Section 301, and
(b) at
such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time such list is furnished;
excluding from any such list names and
addresses received by the Trustee in its capacity as Security Registrar for Registered Securities other than Global Securities.
Section 702. Preservation
of Information; Communications to Holders. (a) The Trustee shall preserve, in as current a form as is reasonably practicable, the
names and addresses of Holders of Registered Securities contained in the most recent list furnished to the Trustee as provided in Section
701 and the names and addresses of Holders of Registered Securities received by the Trustee in its capacity as Security Registrar
or Paying Agent. The Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished.
(b) If
three or more Holders (herein referred to as “applicants”) apply in writing to the Trustee, and furnish to the Trustee reasonable
proof that each such applicant has owned a Security for a period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders with respect to their rights under this Indenture or under
the Securities and is accompanied by a copy of the form of proxy or other communication that such applicants propose to transmit, then
the Trustee shall, within five business days after the receipt of such application, at its election, either
(i) afford such
applicants access to the information preserved at the time by the Trustee in accordance with Section 702(a), or
(ii) inform such
applicants as to the approximate number of Holders whose names and addresses appear in the information preserved at the time by the Trustee
in accordance with Section 702(a), and as to the approximate cost of mailing to such Holders the form of proxy or other communication,
if any, specified in such application.
If the Trustee elects not
to afford such applicants access to such information, the Trustee shall, upon the written request of such applicants, mail to each Holder
whose name and address appear in the information preserved at the time by the Trustee in accordance with Section 702(a) a copy
of the form of proxy or other communication that is specified in such request, with reasonable promptness after a tender to the Trustee
by the applicants of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless
within five days after such tender the Trustee shall mail to such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best
interest of the Holders or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If
the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, enters an order refusing
to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, the Commission finds,
after notice and opportunity for hearing, that all the objections so sustained have been met and enters an order so declaring, the Trustee
shall mail copies of such material to all such Holders with reasonable promptness after the entry of such order and the renewal of such
tender by such applicants; otherwise the Trustee shall be relieved of any obligation or duty to such applicants respecting their application.
(c) Every
Holder of Securities or coupons, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor
the Trustee nor any agent of either of them shall be held accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders in accordance with Section 702(b), regardless of the source from which such information was derived,
and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under Section 702(b).
Section 703. Reports by
Trustee. (a) Within 60 days after May 15 of each year commencing with the year 20__, the Trustee shall transmit by mail to all Holders
of Registered Securities of any series, as their names and addresses appear in the Security Register and to all other Holders who are
entitled to receive reports pursuant to Section 704(3), a brief report dated as of such May 15 with respect to any of the following
events which may have occurred within the previous 12 months (but if no such event has occurred within such period no report need be transmitted):
(1) any
change to its eligibility under Section 609 and its qualifications under Section 608;
(2) the
creation of or any material change to a relationship specified in paragraphs (1) through (10) of Section 310(b) of the Trust Indenture
Act;
(3) the
character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by
the Trustee (as such) which remain unpaid on the date of such report, and for the reimbursement of which it claims or may claim a lien
or charge, prior to that of the Securities of such series or any related coupons, on any property or funds held or collected by it as
Trustee, except that the Trustee shall not be required (but may elect) to report such advances if such advances so remaining unpaid aggregate
not more than one-half of 1% of the principal amount of the Securities of such series Outstanding on the date of such report;
(4) the
amount, interest rate and maturity date of all other indebtedness owing by the Company (or by any other obligor on the Securities of such
series) to the Trustee in its individual capacity, on the date of such report, with a brief description of any property held as collateral
security therefor, except an indebtedness based upon a creditor relationship arising in any manner described in paragraphs (2),
(3), (4) or (6) of Section 311(b) of the Trust Indenture Act;
(5) any
change to the property and funds, if any, physically in the possession of the Trustee as such on the date of such report;
(6) any
additional issue of Securities which the Trustee has not previously reported; and
(7) any
action taken by the Trustee in the performance of its duties hereunder which it has not previously reported and which in its opinion materially
affects the Securities of such series, except action in respect of a default, notice of which has been or is to be withheld by the Trustee
in accordance with Section 602.
(b) The
Trustee shall transmit by mail to all Holders of Registered Securities of any series, as their names and addresses appear in the Security
Register and to all Holders who are entitled to receive reports pursuant to Section 704(3), a brief report with respect to the
character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by
the Trustee (as such) since the date of the last report transmitted pursuant to subsection (a) of this Section (or if no such report has
yet been so transmitted, since the date of execution of this instrument) for the reimbursement of which it claims or may claim a lien
or charge, prior to that of the Securities of such series, on property or funds held or collected by it as Trustee and which it has not
previously reported pursuant to this subsection, except that the Trustee shall not be required (but may elect) to report such advances
if such advances remaining unpaid at any time aggregate 10% or less of the principal amount of the Securities of such series Outstanding
at such time, such report to be transmitted within 90 days after such time.
(c) A
copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which
any Securities are listed, with the Commission and with the Company. The Company will notify the Trustee in writing when any Securities
are listed on any stock exchange.
Section 704. Reports by
Company. The Company shall:
(1) file
with the Trustee, within 45 days after the Company is required to file the same with the Commission, copies of the annual reports and
of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to
time by rules and regulations prescribe) that the Company may be required to file with the Commission pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934; or, if the Company is not required to file information, documents or reports pursuant to
either of said Sections, then it shall file with the Trustee and the Commission, in accordance with rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic information, documents and reports that may be required pursuant
to Section 13 of the Securities Exchange Act of 1934 in respect of a security listed and registered on a national securities exchange
as may be prescribed from time to time in such rules and regulations;
(2) file
with the Trustee and the Commission, in accordance with rules and regulations prescribed by the Commission, such additional information,
documents and reports with respect to compliance by the Company with the conditions and covenants of this Indenture as may be required
from time to time by such rules and regulations; and
(3) transmit
by mail to all Holders of Registered Securities, as their names and addresses appear in the Security Register, to such Holders of Unregistered
Securities as have, within the two years preceding such transmission, filed their names and addresses with the Trustee for that purpose
and to each Holder whose name and address is then preserved on the Trustee’s list pursuant to the first sentence of Section 702(a),
within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed
by the Company pursuant to paragraphs (1) and (2) of this Section as may be required by rules and regulations prescribed from time to
time by the Commission.
ARTICLE
VIII
CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER
Section 801. Company May
Consolidate, Etc. Only on Certain Terms. The Company shall not consolidate with or merge into any other corporation or convey, transfer
or lease all or substantially all of its properties and assets to any Person, unless:
(1) the
corporation formed by such consolidation or into which the Company is merged or the Person that acquires by conveyance, transfer or lease
the properties and assets of the Company substantially as an entirety shall be a Person organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of (and premium, if any)
and interest, if any, on all the Outstanding Securities and the performance of every covenant of this Indenture on the part of the Company
to be performed or observed;
(2) immediately
after giving effect to such transaction, no Event of Default and no event that, after notice or lapse of time or both, would become an
Event of Default, shall have occurred and be continuing;
(3) the
Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental indenture comply with this Article and that all conditions precedent herein provided
for relating to such transaction have been met.
Section 802. Successor
Corporation Substituted. Upon any consolidation or merger or any conveyance, transfer or lease of all or substantially all the properties
and assets of the Company in accordance with Section 801, the successor corporation formed by such consolidation or into which
the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect as if such successor corporation had been named as the
Company herein and thereafter, in the case of a conveyance, transfer or lease of properties and assets of the Company substantially as
an entirety, such conveyance, transfer or lease shall have the effect of releasing the Person named as the “Company” in the
first paragraph of this instrument or any successor corporation which shall theretofore have become such in the manner prescribed in this
Article from its liability as obligor and maker on any of the Securities.
ARTICLE
IX
SUPPLEMENTAL INDENTURES
Section 901. Supplemental
Indentures Without Consent of Holders. Without the consent of any Holders, the Company and the Trustee, at any time and from time
to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) to
evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to
add to the covenants of the Company for the benefit of the Holders of all or any series of Securities, or any Tranche thereof (and if
such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included
solely for the benefit of such series), or to surrender any right or power herein conferred upon the Company; or
(3) to
add any additional Events of Default with respect to all or any series of Securities Outstanding hereunder; or
(4) to
add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons; or
(5) to
change or eliminate any of the provisions of this Indenture, or to add any new provision to this Indenture, in respect of one or more
series or Tranches of Securities; provided, however, that any such change, elimination or addition (A) shall neither (i)
apply to any Security Outstanding on the date of such indenture supplemental hereto nor (ii) modify the rights of the Holder of any such
Security with respect to such provision in effect prior to the date of such indenture supplemental hereto or (B) shall become effective
only when no Security of such series or Tranche remains Outstanding; or
(6) to
secure the Securities pursuant to the requirements of any covenant on liens in respect of such series of Securities or otherwise; or
(7) to
establish for the issuance of and establish the form or terms and conditions of Securities of any series or Tranche as permitted by Section
301, and to establish the form of any certificates required to be furnished pursuant to the terms of this Indenture or any series
of Securities; or
(8) to
provide for uncertificated Securities in addition to or in place of all, or any series or Tranche of, certificated Securities; or
(9) to
evidence and provide for the acceptance of appointment hereunder by a separate or successor Trustee or co-trustee with respect to the
Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for
or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 611(b);
or
(10) to
change any place or places where (a) the principal of or premium, if any, or interest, if any, on all or any series of Securities, or
any Tranche thereof, shall be payable, (b) all or any series of Securities, or any Tranche thereof, may be surrendered for registration
or transfer, (c) all or any series of Securities, or any Tranche thereof, may be surrendered for exchange and (d) notices and demands
to or upon the Company in respect of all or any series of Securities, or any Tranche thereof, and this Indenture may be served;
(11) to
cure any ambiguity, to correct or supplement any provision herein that may be defective or inconsistent with any other provision herein,
provided such action shall not adversely affect the interests of the Holders of Securities of any series or Tranche in any material
respect; or
(12) to
make any other provisions with respect to matters or questions arising under this Indenture, provided such action shall not adversely
affect the interests of the Holders of any Securities of any series or Tranche Outstanding on the date of such indenture supplemental
hereto.
Without limiting the generality
of the foregoing, if the Trust Indenture Act as in effect at the date of the execution and delivery of this Indenture or at any time thereafter
becomes amended and
(x) if
any such amendment requires one or more changes to any provisions hereof or the inclusion herein of any additional provisions, or by operation
of law is deemed to effect such changes or incorporate such provisions by reference or otherwise, this Indenture shall be deemed to have
been amended so as to conform to such amendment to the Trust Indenture Act, and the Company and the Trustee may, without the consent of
any Holders, enter into an indenture supplemental hereto to effect or evidence such changes or additional provisions; or
(y) if
any such amendment permits one or more changes to, or the elimination of, any provisions hereof that, at the date hereof or at any time
thereafter, are required by the Trust Indenture Act to be contained herein (or if it is no longer required by the TIA for the Indenture
to contain one or more provisions), this Indenture shall be deemed to have been amended to effect such changes or elimination, and the
Company and the Trustee may, without the consent of any Holders, enter into an indenture supplemental hereto to evidence such amendment
hereof; or
(z) if,
by reason of any such amendment, it shall be no longer necessary for this Indenture to contain one or more provisions that, at the date
of the execution and delivery hereof, are required by the Trust Indenture Act to be contained herein, the Company and the Trustee may,
without the consent of any Holders, enter into an indenture supplemental hereto to effect the elimination of such provisions.
Section 902. Supplemental
Indentures With Consent of Holders. (a) Except as set forth in paragraph (c) below, with the consent of the Holders of not less than
a majority in aggregate principal amount of the Senior Securities of all series then Outstanding (considered as one class), the Company,
when authorized by a resolution of its Board of Directors (which resolution may provide general terms or parameters for such action and
may provide that the specific terms of such action may be determined in accordance with or pursuant to a Company Order), and the Trustee
may, from time to time and at any time, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in
any manner the rights of the Holders of the Securities of each such series or Tranche or of the Coupons appertaining to such Securities
or of modifying in any manner the rights of the Holders of Securities of such series or Tranche under this Indenture; provided, however,
that if there are Senior Securities of more than one series Outstanding hereunder and if a proposed supplemental indenture shall directly
affect the rights of the Holders of Senior Securities of one or more, but less than all, of such series, then the consent only of the
Holders of a majority in aggregate principal amount of the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and provided, further, that if the Securities of any series have been issued in more than one Tranche
and if the proposed supplemental indenture shall directly affect the rights of the Holders of Senior Securities of one or more, but less
than all, of such Tranches, then the consent only of the Holders of a majority in aggregate principal amount of the Outstanding Securities
of all Tranches so directly affected, considered as one class, shall be required.
(b) Except
as set forth in paragraph (c) below, with the consent of the Holders of not less than a majority in aggregate principal amount of the
Subordinated Securities of all series then Outstanding (considered as one class), the Company, when authorized by a resolution of its
Board of Directors (which resolution may provide general terms or parameters for such action and may provide that the specific terms of
such action may be determined in accordance with or pursuant to a Company Order), and the Trustee may, from time to time and at any time,
enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the Holders of the
Securities of each such series or of the Coupons appertaining to such Securities or of modifying in any manner the rights of the Holders
of Securities of such series or Tranche under this Indenture; provided, however, that if there are Subordinated Securities of more
than one series Outstanding hereunder and if a proposed supplemental indenture shall directly affect the rights of the Holders of Subordinated
Securities of one or more, but less than all, of such series, then the consent only of the Holders of a majority in aggregate principal
amount of the Outstanding Securities of all series so directly affected, considered as one class, shall be required; and provided,
further, that if the Securities of any series have been issued in more than one Tranche and if the proposed supplemental indenture
shall directly affect the rights of the Holders of Subordinated Securities of one or more, but less than all, of such Tranches, then the
consent only of the Holders of a majority in aggregate principal amount of the Outstanding Securities of all Tranches so directly affected,
considered as one class, shall be required.
(c)
No such supplemental indenture or waiver shall, without the consent of the Holder of each Outstanding Security affected thereby,
(1) change
the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest thereon (or the amount of any installment of interest thereon) or any premium payable upon the redemption
thereof, or change the method of calculating the rate of interest thereon, or reduce the amount of the principal of an Original Issue
Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502,
or change the coin or currency (or other property) in which, any Security or any premium or the interest thereon is payable, or impair
the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption,
on or after the Redemption Date, or, in the case of repayment at the option of the Holders, on or after the Repayment Date), or modify
any provisions of this Indenture with respect to the conversion or exchange of the Securities into Securities of another series or into
any other debt or equity securities in a manner adverse to the Holders, or
(2) reduce
the percentage in principal amount of the Outstanding Securities of any series, or any Tranche thereof, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions
of this Indenture or certain defaults hereunder and their consequences provided for in this indenture, or
(3) modify
any of the provisions of this Section, Section 513 or Section 1007, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Security
affected thereby, provided, however, that this clause shall not be deemed to require the consent of any Holder with respect
to changes in the references to “the Trustee” and concomitant changes in this Section and Section 1007, or the deletion
of this proviso, in accordance with the requirements of Sections 611(b) and 901(9).
A supplemental indenture that
changes or eliminates any covenant or other provision of this Indenture that has expressly been included solely for the benefit of one
or more particular series of Securities, or one or more Tranches thereof, or that modifies the rights of the Holders of Securities of
such series or Tranches with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture
of the Holders of Securities of any other series or Tranche.
It shall not be necessary
for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient
if such Act shall approve the substance thereof. A waiver by a Holder of such Holder’s rights to consent under this Section shall
be deemed to be a consent of such Holder.
Section 903. Execution
of Supplemental Indentures. In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this
Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture
is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture
that affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of
Supplemental Indentures. Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. Any supplemental indenture permitted by this Article
may restate this Indenture in its entirety, and, upon the execution and delivery thereof, any such restatement shall supersede this Indenture
as theretofore in effect for all purposes.
Section 905. Conformity
With Trust Indenture Act. Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the
Trust Indenture Act as then in effect.
Section 906. Reference
in Securities to Supplemental Indentures. Securities of any series, or any Tranche thereof, authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved
by the Trustee as to any matter provided for in such supplemental indenture. If the Company so determines, new Securities of any series,
or any Tranche thereof, and any appertaining coupons so modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series or Tranche and any appertaining coupons.
Section 907. Revocation
and Effect of Consents. Until an amendment or waiver becomes effective, a consent to it by a Holder of a Security is a continuing
consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting
Holder’s Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may
revoke the consent as to his Security or portion of a Security if the Trustee receives the notice of revocation before the date on which
the Trustee receives an Officer’s Certificate certifying that the Holders of the requisite principal amount of Securities have consented
to the amendment or waiver. After an amendment or waiver becomes effective, it shall bind every Holder of each series of Securities affected
by such amendment or waiver.
The Company may, but shall
not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If a
record date is fixed, then notwithstanding the provisions of the immediately preceding paragraph, those persons who were Holders at such
record date (or their duly designated proxies), and only those persons, shall be entitled to consent to such amendment or waiver or to
revoke any consent previously given, whether or not such persons continue to be Holders after such record date.
After an amendment or waiver
becomes effective it shall bind every Holder, unless it is of the type described in any of clauses (1) through (3) of Section 902(c).
In such case, the amendment or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security
that evidences the same debt as the consenting Holder’s Security.
Section 908. Modification
Without Supplemental Indenture. If the terms of any particular series of Securities have been established in a Board Resolution or
an Officer’s Certificate as contemplated by Section 301, and not in an indenture supplemental hereto, additions to, changes
in or the elimination of any of such terms may be effected by means of a supplemental Board Resolution or Officer’s Certificate,
as the case may be, delivered to, and accepted by, the Trustee; provided, however, that such supplemental Board Resolution or Officer’s
Certificate shall not be accepted by the Trustee or otherwise be effective unless all conditions set forth in this Indenture that would
be required to be satisfied if such additions, changes or elimination were contained in a supplemental indenture shall have been appropriately
satisfied. Upon the acceptance thereof by the Trustee, any such supplemental Board Resolution or Officer’s Certificate shall be
deemed to be a “supplemental indenture” for purposes of Sections 904 and 906.
ARTICLE
X
COVENANTS
Section 1001. Payment of
Principal, Premium and Interest. Subject to the following provisions, the Company will pay to the Trustee the amounts, in such coin
or currency as is at the time legal tender for the payment of public or private debt, in the manner, at the times and for the purposes
set forth herein and in the text of the Securities for each series, and the Company hereby authorizes and directs the Trustee from funds
so paid to it to make or cause to be made payment of the principal of and premium, if any, and interest, if any, on the Securities and
coupons of each series as set forth herein and in the text of such Securities and coupons. Unless otherwise provided in the Securities
of a series, the Trustee will arrange directly with any Paying Agents for the payment, or the Trustee will make payment, from funds furnished
by the Company, of the principal of and premium, if any, and interest, if any, on the Securities and coupons of each series by check or
draft.
Unless otherwise provided
in the Securities of a series, interest, if any, on Registered Securities of a series shall be paid by check or draft on each Interest
Payment Date for such series to the Holder thereof at the close of business on the relevant record dates specified in the Securities of
such series. The Company may pay such interest by check or draft mailed to such Holder’s address as it appears on the register for
Securities of such series. Unless otherwise provided in the Securities of a series, principal of Registered Securities shall be payable
by check or draft and only against presentation and surrender of such Registered Securities at the office of the Paying Agent, unless
the Company shall have otherwise instructed the Trustee in writing.
Unless otherwise provided
in the Securities of a series, (i) interest, if any, on Unregistered Securities shall be paid by check or draft and only against presentation
and surrender of the coupons for such interest installments as are evidenced thereby as they mature and (ii) original issue discount (as
defined in Section 1273 of the Code), if any, on Unregistered Securities shall be paid by check or draft and only against presentation
and surrender of such Securities, in either case at the office of a Paying Agent located outside of the United States and its possessions,
unless the Company has otherwise instructed the Trustee in an Officer’s Certificate. Unless otherwise provided in the Securities
of a series, principal of and premium, if any, of Unregistered Securities shall be paid by check or draft and only against presentation
and surrender of such Securities as provided in the Securities of a series. If at the time a payment of principal of and premium, if any,
or interest, if any, or original issue discount, if any, on an Unregistered Security or coupon becomes due and the payment of the full
amount so payable at the office or offices of all the Paying Agents outside the United States and its possessions is illegal or effectively
precluded because of the imposition of exchange controls or other similar restrictions on the payment of such amount in United States
currency, then the Company may instruct the Trustee in an Officer’s Certificate to make such payments at the office of a Paying
Agent located in the United States. The Company hereby covenants and agrees that it shall not so instruct the Trustee with respect to
payment in the United States if such payment would cause such Unregistered Security to be treated as a “registration-required obligation”
under United States law and regulations.
At the election of the Company,
any payments by the Company provided for in this Indenture or in any of the Securities may be made by electronic funds transfer.
Section 1002. Maintenance
of Office or Agency. The Company will maintain in each Place of Payment for any series of Securities, or any Tranche thereof, an office
or agency where Registered Securities, or any Tranche thereof, of that series may be surrendered for registration of transfer or exchange
and a Place of Payment where (subject to Sections 305 and 307) Securities may be presented for payment or exchange and where
notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. Unless otherwise
specified pursuant to Section 301 with respect to any such series, the Company shall maintain such offices or agencies in connection
with each series in the Borough of Manhattan, The City of New York, State of New York. With respect to any series of Securities issued
in whole or in part as Unregistered Securities, the Company shall maintain one or more Paying Agents located outside the United States
and its possessions and shall maintain such Paying Agents for a period of one year after the principal of such Unregistered Securities
has become due and payable. During any period thereafter for which it is necessary in order to conform to United States tax law or regulations,
the Company will maintain a Paying Agent outside the United States and its possessions to which the Unregistered Securities or coupons
appertaining thereto may be presented for payment and will provide the necessary funds therefor to such Paying Agent upon reasonable notice.
The Security Registrar shall keep a register with respect to each series of Securities issued in whole or in part as Registered Securities
and to their transfer and exchange. The Company may appoint one or more co-Security Registrars acceptable to the Trustee and one or more
additional Paying Agents for each series of Securities, and the Company may terminate the appointment of any co-Security Registrar or
Paying Agent at any time upon written notice. The term “Security Registrar” includes any co-Security Registrar. The term “Paying
Agent” includes any additional Paying Agent. The Company shall notify the Trustee of the name and address of any Agent not a party
to this Indenture. Subject to Section 305, if the Company fails to maintain a Security Registrar or Paying Agent, the Trustee shall
act as such. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Company fails to maintain any such required office or agency or fails to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
The Company may also from
time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered
for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation
or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities
of any series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
In the case of Original Issue
Discount Securities of a series, the Company shall, prior to any Redemption Date or any Repayment Date applicable thereto, furnish the
Trustee with an Officer’s Certificate stating the amount of principal to be paid to a Holder of $1,000 principal amount of such
Securities.
Anything herein to the contrary
notwithstanding, any office or agency required by this Section may be maintained at any office of the Company in which event the Company
shall perform all functions to be performed at such office or agency.
Section 1003. Money for
Securities Payments to Be Held in Trust. If the Company at any time acts as its own Paying Agent with respect to any series of Securities,
or any Tranche thereof, it will, on or before each due date of the principal of (and premium, if any) or interest, if any, on any of such
Securities, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal (and premium,
if any) or interest so becoming due until such sums are paid to such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.
Whenever the Company has one
or more Paying Agents for any series of Securities, it will, on or prior to (and if on, then before 11:00 a.m. (New York City time)) each
due date of the principal of (and premium, if any) or interest, if any, on such Securities, deposit with a Paying Agent a sum sufficient
(in immediately available funds, if payment is made on the due date) to pay the principal (and premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each
Paying Agent for any series of Securities, or any Tranche thereof, other than the Trustee, to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:
(1) hold
all sums held by it for the payment of the principal of (and premium, if any) or interest, if any, on Securities of such series or Tranche
in trust for the benefit of the Persons entitled thereto until such sums are paid to such Persons or otherwise disposed of as herein provided;
(2) give
the Trustee notice of any default by the Company (or any other obligor upon the Securities of such series or Tranche) in the making of
any payment of principal (and premium, if any) or interest, if any, on the Securities of such series or Tranche; and
(3) at
any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
The Company may at any time,
for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct
any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying
Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.
Any money deposited with the
Trustee or any Paying Agent, or received by the Trustee in respect of Eligible Obligations deposited with the Trustee pursuant to Section
401, 403 or 1007, or then held by the Company, in trust for the payment of the principal of (and premium, if any) or
interest, if any, on any Security of any series and remaining unclaimed for two years (or such shorter period for the return of such moneys
to the Company under applicable abandoned property laws) after such principal (and premium, if any) or interest has become due and payable
shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder
of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at
the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each
Business Day and of general circulation in the Borough of Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company.
Section 1004. Corporate
Existence. Subject to Article VIII, the Company will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence, rights (charter and statutory) and franchises; provided, however, that the Company shall
not be required to preserve any such right or franchise if, in the judgment of the Company, the preservation thereof is no longer desirable
in the conduct of the business of the Company and the loss thereof is not disadvantageous in any material respect to the Holders of Securities
of any series or Tranche in any material respect.
Section 1005. Defeasance
of Certain Obligations. The Company may omit to comply with its obligations under the covenants contained in Sections 1002, 1004
(except with respect to maintaining its corporate existence), 1006, 1008 and Article VIII with respect to any Security or
Securities of any series or Tranche or any portion of the principal amount thereof (and in respect of any term, provision or condition
set forth in the covenants or restrictions specified for such Securities pursuant to Section 301, in any supplemental indenture,
Board Resolution or Officer’s Certificate establishing such Security), provided that the following conditions shall have
been satisfied:
(1) With
reference to this Section, the Company has deposited or caused to be irrevocably deposited (except as provided in Section 402)
with the Trustee as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of
such Securities or portions thereof, (i) money in an amount, or (ii) if Securities of such series are not subject to repayment at the
option of Holders, (A) Eligible Obligations which through the payment of interest and principal in respect thereof in accordance with
their terms will provide not later than one day before the due date of any payment referred to in clause (x) or (y) of this subparagraph
(1) money in an amount, or (B) a combination thereof, sufficient, in the opinion of a nationally recognized firm of independent certified
public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge (x) the principal of (and
premium, if any) and each installment of principal (and premium, if any) and interest, if any, on the Outstanding Securities of such series
or portions thereof on the Stated Maturity of such principal or installment of principal or premium or interest or to and including the
Redemption Date irrevocably designated by the Company pursuant to subparagraph (7) of this Section and (y) any mandatory sinking fund
payments applicable to the Securities of such series or portions thereof on the day on which such payments are due and payable in accordance
with the terms of the Indenture and of such Securities or portions thereof;
(2) Such
deposit shall not, as specified in an Opinion of Counsel, cause the Trustee with respect to the Securities of such series to have a conflicting
interest as defined in Section 608 and for purposes of the Trust Indenture Act with respect to the Securities of such series;
(3) Such
deposit will not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument
to which the Company is a party or by which it is bound;
(4) No
Event of Default or event which with notice or lapse of time would become an Event of Default with respect to the Securities of such series
shall have occurred and be continuing on the date of such deposit and no Event of Default specified in Section 501(6) or (7)
shall have occurred at any time from the date of such deposit to the 91st calendar day thereafter (it being understood that this condition
to defeasance may not be satisfied until such 91st calendar day after the date of deposit);
(5) The
Company shall have delivered to the Trustee an Opinion of Counsel to the effect that Holders of the Securities of such series will not
realize income, gain or loss for federal income tax purposes as a result of such deposit and defeasance of certain obligations and will
be subject to federal income tax on the same amount and in the same manner and at the same times, as would have been the case if such
deposit and defeasance had not occurred;
(6) The
Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the defeasance contemplated by this Section have been met; and
(7) If
the Company has deposited or caused to be deposited money or Eligible Obligations to pay or discharge the principal of (and premium, if
any) and interest, if any, on the Outstanding Securities of such series or portion thereof to and including a Redemption Date pursuant
to subparagraph (1) of this Section, such Redemption Date shall be irrevocably designated by a Board Resolution delivered to the Trustee
on or prior to the date of deposit of such money or Eligible Obligations, and such Board Resolution shall be accompanied by an irrevocable
Company Request that the Trustee give notice of such redemption in the name and at the expense of the Company not less than 30 nor more
than 60 days prior to such Redemption Date in accordance with Section 1104.
Section 1006. Statement
by Officers as to Default. The Company will deliver to the Trustee, within 120 days after the end of each fiscal year of the Company
ending after the date hereof, a written statement, which need not comply with Section 102, signed by the principal executive officer,
the principal financial officer or the principal accounting officer of the Company stating, as to each signer thereof, that
(1) a
review of the activities of the Company during such year and of performance under this Indenture has been made under his supervision,
and
(2) to
the best of his knowledge, based on such review, the Company has fulfilled all its obligations under this Indenture throughout such year,
or, if there has been a default in the fulfillment of any such obligation, specifying each such default known to him and the nature and
status thereof.
Section 1007. Waiver of
Certain Covenants. (a) The Company may omit in any particular instance to comply with any term, provision or condition set forth in
(i) any additional covenants or restrictions specified with respect to the Senior Securities of any series, or any Tranche thereof, as
contemplated by Section 301 if before the time for such compliance the Holders of not less than a majority in aggregate principal
amount (or such larger proportion as may be required in respect of waiving a past default of any such additional covenant or restriction)
of the Outstanding Securities of all series and Tranches with respect to which such covenant or restriction was so specified, considered
as one class, by Act of such Holders, either waives such compliance in such instance or generally waive compliance with such term, provision
or condition and (ii) Sections 1002, 1004, 1006 and 1008 and Article VIII if before the time for such compliance
the Holders of at least a majority in principal amount of Senior Securities Outstanding under this Indenture by Act of such Holders, either
waives such compliance in such instance or generally waive compliance with such term, provision or condition; but, in the case of (i)
or (ii) of this paragraph (a), no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly
waived, and, until such waiver becomes effective, the obligations of the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and effect.
(b) The
Company may omit in any particular instance to comply with any term, provision or condition set forth in (i) any additional covenants
or restrictions specified with respect to the Subordinated Securities of any series, or any Tranche thereof, as contemplated by Section
301 if before the time for such compliance the Holders of not less than a majority in aggregate principal amount (or such larger proportion
as may be required in respect of waiving a past default of any such additional covenant or restriction) of the Outstanding Securities
of all series and Tranches with respect to which such covenant or restriction was so specified, considered as one class, by Act of such
Holders, either waives such compliance in such instance or generally waive compliance with such term, provision or condition and (ii)
Sections 1002, 1004, 1006 and 1008 and Article VIII if before the time for such compliance the Holders of at least
a majority in principal amount of Subordinated Securities Outstanding under this Indenture by Act of such Holders, either waives such
compliance in such instance or generally waive compliance with such term, provision or condition; but, in the case of (i) or (ii) of this
paragraph (b), no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and,
until such waiver becomes effective, the obligations of the Company and the duties of the Trustee in respect of any such term, provision
or condition shall remain in full force and effect.
Section 1008. Maintenance
of Properties. The Company shall cause (or, with respect to property owned in common with others, make reasonable effort to cause)
all its properties used or useful in the conduct of its business to be maintained and kept in good condition, repair and working order
and shall cause (or, with respect to property owned in common with others, make reasonable effort to cause) to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as, in the judgment of the Company, may be necessary so that the business
carried on in connection therewith may be properly conducted; provided, however, that nothing in this Section shall prevent the
Company from discontinuing, or causing the discontinuance of, the operation and maintenance of any of its properties if, in the judgment
of the Company, such discontinuance (i) is desirable in the conduct of its business and (ii) will not adversely affect the interests of
the Holders of Securities of any series or Tranche in any material respect.
ARTICLE
XI
REDEMPTION OF SECURITIES
Section 1101. Applicability
of Article. Securities of any series, or any Tranche thereof, that are redeemable before their Stated Maturity (or, if the principal
of the Securities of any series is payable in installments, the Stated Maturity of the final installment of the principal thereof) shall
be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 301 for Securities of
any series or Tranche) in accordance with this Article.
Section 1102. Election
to Redeem; Notice to Trustee. The election of the Company to redeem any Securities shall be evidenced by a Board Resolution or an
Officer’s Certificate. In case of any redemption at the election of the Company of less than all the Securities of any series, the
Company shall, at least 45 days prior to the Redemption Date fixed by the Company (unless a shorter notice is satisfactory to the Trustee),
notify the Trustee of such Redemption Date and of the principal amount of Securities of such series or Tranche to be redeemed. In the
case of any redemption of Securities (a) prior to the expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Indenture, or (b) pursuant to an election of the Company that is subject to a condition specified
in the terms of such Securities the Company shall furnish the Trustee with an Officer’s Certificate evidencing compliance with such
restriction.
Section 1103. Selection
by Trustee of Securities to Be Redeemed. If less than all the Securities of any series, or any Tranche thereof, are to be redeemed,
the particular Securities to be redeemed shall be selected by the Trustee not more than 45 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series or Tranche not previously called for redemption, by such method as is provided for any
particular series, or, in the absence of any such provision, by such method as the Trustee deems fair and appropriate and which may provide
for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or Tranche or
any integral multiple thereof) of the principal amount of Securities of such series or Tranche of a denomination larger than the minimum
authorized denomination for Securities of that series or Tranche; provided, however, that if, as indicated in an Officer’s
Certificate, the Company has offered to purchase all or any principal amount of the Securities then Outstanding of any series, or any
Tranche thereof, and less than all of such Securities as to which such offer was made have been tendered to the Company for such purchase,
the Trustee, if so directed by Company Order, shall select for redemption all or any principal amount of such Securities that have not
been so tendered.
The Trustee shall promptly
notify the Company and the Security Registrar in writing of the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture,
unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities
redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities that has been or is to be redeemed.
Section 1104. Notice of
Redemption. Unless otherwise specified as contemplated by Section 301 with respect to any series of Securities, notice of redemption
shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Securities to be redeemed, at his address appearing in the Security Register.
If Unregistered Securities
are to be redeemed, notice of redemption shall be published in an Authorized Newspaper in The City of New York and, if such Securities
to be redeemed are listed on any stock exchange outside of the United States, in the city in which such stock exchange is located, or
in such other city or cities as may be specified in the Securities, once in each of two different calendar weeks, the first publication
to be not less than 30 nor more than 90 days before the redemption date.
All notices of redemption
shall state:
(1) the
Redemption Date,
(2) the
Redemption Price, or the formula pursuant to which the Redemption Price is to be determined if the Redemption Price cannot be determined
at the time of notice is given,
(3) if
less than all the Outstanding Securities of any series or Tranche are to be redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Securities to be redeemed, and the portion of the principal amount of any Security
to be redeemed in part and, in the case of any such Security of such series to be redeemed in part, that, on and after the Redemption
Date, upon surrender of such Security, a new Security or Securities of such series in principal amount equal to the remaining unpaid principal
amount thereof will be issued as provided in Section 1106,
(4) that
on the Redemption Date the Redemption Price will become due and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the
place or places where such Securities and all unmatured coupons are to be surrendered for payment of the Redemption Price and accrued
interest, if any,
(6) that
the redemption is for a sinking fund, if such is the case,
(7) the
CUSIP numbers, if any, assigned to such Securities; provided however, that such notice may state that no representation is made
as to the correctness of CUSIP numbers, and the redemption of such Securities shall not be affected by any defect in or omission of such
number, and
(8) such
other matters as the Company shall deem desirable or appropriate.
Unless otherwise specified
with respect to any Securities in accordance with Section 301, with respect to any notice of redemption of Securities at the election
of the Company, unless, upon the giving of such notice, such Securities are deemed to have been paid in accordance with Section 401,
such notice may state that such redemption shall be conditional upon the receipt by the Paying Agent or Agents for such Securities, on
or prior to the date fixed for such redemption, of money sufficient to pay the principal of and premium, if any, and interest, if any,
on such Securities and that if such money has not been so received such notice shall be of no force or effect and the Company shall not
be required to redeem such Securities. In the event that such notice of redemption contains such a condition and such money is not so
received, the redemption shall not be made and within a reasonable time thereafter notice shall be given, in the manner in which the notice
of redemption was given, that such money was not so received and such redemption was not required to be made, and the Paying Agent or
Agents for the Securities otherwise to have been redeemed shall promptly return to the Holders thereof any of such Securities that had
been surrendered for payment upon such redemption.
Notice of redemption of Securities
to be redeemed at the election of the Company, and any notice of non-satisfaction of a condition for redemption as aforesaid, shall be
given by the Company or, at the Company’s request, by the Security Registrar in the name and at the expense of the Company. Notice
of mandatory redemption of Securities shall be given by the Security Registrar in the name and at the expense of the Company.
Section 1105. Securities
Payable on Redemption Date. Notice of redemption having been given as aforesaid, and the conditions, if any, set forth in such notice
having been satisfied, the Securities or portions thereof so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the Company defaults in the payment of the Redemption Price and
accrued interest, if any) such Securities, or portions thereof, if interest-bearing, shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security or portion thereof together with all unmatured coupons, if
any, shall be paid by the Company at the Redemption Price, together with accrued interest, if any, to the Redemption Date but in the case
of Unregistered Securities installments of interest due on or prior to the Redemption Date will be payable to the bearers of the coupons
for such interest by check or draft upon surrender of such coupons; provided, however, that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Regular Record Dates according to their terms and the provisions of Section
307.
If any Security called for
redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest
from the Redemption Date at the rate prescribed therefor in the Security.
Section 1106. Securities
Redeemed in Part. Any Security that is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or his or her attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same
series, of any authorized denomination as requested by such Holder, and of like tenor and in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Security so surrendered.
ARTICLE
XII
SINKING FUNDS
Section 1201. Applicability
of Article. The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of any series,
or any Tranche thereof, except as otherwise specified as contemplated by Section 301 for Securities of such series or Tranche.
The minimum amount of any
sinking fund payment provided for by the terms of Securities of any series, or any Tranche thereof, is herein referred to as a “mandatory
sinking fund payment”, and any payment in excess of such minimum amount provided for by the terms of Securities of any series, or
any Tranche thereof, is herein referred to as an “optional sinking fund payment”. If provided for by the terms of Securities
of any series, or any Tranche thereof, the cash amount of any sinking fund payment may be subject to reduction as provided in Section
1202. Each sinking fund payment shall be applied to the redemption of Securities of the series or Tranche in respect of which it was
made as provided for by the terms of Securities of such series.
Section 1202. Satisfaction
of Sinking Fund Payments With Securities. The Company (1) may deliver Outstanding Securities of a series or Tranche (other than any
previously called for redemption) together, in the case of Unregistered Securities, with all unmatured coupons appertaining thereto, in
respect of which a mandatory sinking fund payment is to be made and (2) may apply as a credit Securities of such series or Tranche that
have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for
by the terms of such series, provided that such Securities have not been previously so credited. Such Securities shall be received
and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of
the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.
Section 1203. Redemption
of Securities for Sinking Fund. Not less than 45 days prior to each sinking fund payment date for any series of Securities, or any
Tranche thereof, the Company will deliver to the Trustee an Officer’s Certificate specifying the amount of the next ensuing sinking
fund payment for that series or Tranche pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by
payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant
to Section 1202 and will also deliver to the Trustee any Securities to be so delivered. If the Company has not delivered such Officer’s
Certificate and, to the extent applicable, all such Securities, the next succeeding sinking fund payment for such series or Tranche shall
be made entirely in cash in the amount of the mandatory sinking fund payment. Not less than 30 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section
1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided
in Section 1104. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 1105 and 1106.
ARTICLE
XIII
REPAYMENT OF SECURITIES AT OPTION OF HOLDERS
Section 1301. Applicability
of Article. Securities of any series or Tranche that are repayable before their Stated Maturity at the option of the Holders shall
be repayable in accordance with their terms and (except as otherwise specified as contemplated by Section 301 for Securities of
any series) in accordance with this Article.
Section 1302. Notice of
Repayment Date. Notice of any Repayment Date with respect to Securities of any series or Tranche thereof shall be given by the Company
not less than 45 nor more than 60 days prior to such Repayment Date (or at such other times as may be specified for such repayment or
repurchase pursuant to Section 301 of this Indenture) to each Holder of Securities of such series in accordance with Section
106.
The notice as to the Repayment
Date shall state (unless otherwise specified for such repayment or repurchase pursuant to Section 301 of this Indenture):
(1) the
Repayment Date, which date shall be no earlier than 30 days and no later than 60 days from the date on which such notice is mailed;
(2) the
principal amount of the Securities required to be repaid or repurchased and the Repayment Price (or the formula pursuant to which the
Repayment Price is to be determined if the Repayment Price cannot be determined at the time the notice is given);
(3) the
place or places where such Securities are to be surrendered for payment of the Repayment Price, and accrued interest, if any, and the
date by which Securities must be so surrendered in order to be repaid or repurchased;
(4) that
any Security not tendered or accepted for payment shall continue to accrue interest;
(5) that,
unless the Company defaults in making such payment or the Paying Agent is prohibited from paying such money to the Holders on that date
pursuant to the terms of this Indenture, Securities accepted for payment pursuant to any such offer of repayment or repurchase shall cease
to accrue interest after the Repayment Date;
(6) that
Holders electing to have a Security repaid or purchased pursuant to such offer may elect to have all or any portion of such Security purchased;
(7) that
Holders electing to have a Security repaid or repurchased pursuant to any such offer shall be required to surrender the Security, with
such customary documents of surrender and transfer as the Company may reasonably request, duly completed, or transfer by book-entry transfer,
to the Company or the Paying Agent at the address specified in the notice at least two Business Days prior to the Repayment Date;
(8) that
Holders shall be entitled to withdraw their election if the Company or the Paying Agent, as the case may be, receives, not later than
the expiration of the offer to repay or repurchase, a telegram, facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Security the Holder delivered for purchase and a statement that such Holder is withdrawing its election to
have such Security purchased;
(9) that,
in the case of a repayment or repurchase of less than all Outstanding Securities of a series or Tranche thereof, the method of selection
of Securities to be repaid or repurchased to be applied by the Trustee if the principal amount of properly tendered Securities exceeds
the principal amount of the Securities to be repaid or repurchased;
(10) that
Holders whose Securities are purchased only in part shall be issued new Securities of the same series or Tranche thereof equal in principal
amount to the unpurchased portion of the Securities surrendered (or transferred by book-entry transfer); and
(11) the
CUSIP or other identification number, if any, printed on the Securities being repurchased and that no representation is made as to the
correctness or accuracy of the CUSIP or other identification number, if any, listed in such notice or printed on the Securities.
Section 1303. Securities
Payable on Repayment Date. The form of option to elect repurchase or repayment having been delivered as specified in the form of Security
for such series, the Securities of such series or Tranche so to be repaid (after application of the method of selection described pursuant
to clause (9) of Section 1302, if the principal amount of properly tendered Securities exceeds the principal amount of the Securities
to be repaid or repurchased) shall, on the Repayment Date, become due and payable at the Repayment Price applicable thereto and from and
after such date (unless the Company defaults in the payment of the Repayment Price and accrued interest) such Securities shall cease to
bear interest. Upon surrender of any such Security for repayment in accordance with said notice, such Security shall be paid by the Company
at the Repayment Price together with accrued interest, if any, to the Repayment Date; provided, however, that if a Security is
repaid or repurchased on or after a Record Date but on or prior to the Stated Maturity of any installments of interest, then any accrued
and unpaid interest due on such Stated Maturity shall be payable to the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307.
If any Security is not paid
upon surrender thereof for repayment, the principal (and premium, if any) shall, until paid, bear interest from the Repayment Date at
the rate prescribed therefor in such Security.
Section 1304. Securities
Repaid in Part. Any Security that by its terms may be repaid in part at the option of the Holder and that is to be repaid only in
part shall be surrendered at any office or agency of the Company designated for that purpose pursuant to Section 1002 (with, if
the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or his or her attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the
same series, as provided in Section 305, of any authorized denomination as requested by such Holder, in aggregate principal amount
equal to and in exchange for the unrepaid portion of the principal of the Security so surrendered.
This instrument may be executed
in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
IN WITNESS WHEREOF, the parties
hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all
as of the date first above written.
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E-HOME
HOUSEHOLD SERVICE HOLDINGS LIMITED
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[CORPORATE SEAL]
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By
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Chief
Executive Officer
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Attest:
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Secretary
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[ ]
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By
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STATE OF [ ]
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)
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) ss:
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CITY OF [ ] AND COUNTY OF [ ])
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On the day of [ ] 20__, before
me personally came _______, to me known, who, being by me duly sworn, did depose and say that he is a director of E-HOME HOUSEHOLD SERVICE
HOLDINGS LIMITED, one of the companies described in and which executed the foregoing instrument; that he knows the seal of said corporation;
that the seal affixed to said instruments is such corporate seal; that it was so affixed by authority of the By-Laws of said corporation,
and that he signed his name thereto by authority of the Board of Directors of said corporation.
E-HOME HOUSEHOLD SERVICE HOLDINGS LIMITED
Reconciliation and tie between Trust Indenture
Act of 1939 and
Indenture, dated as of __, 20__
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Trust Indenture
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Act Section
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Indenture Sections
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§ 310
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(a)(1)
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609
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(a)(2)
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609
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(a)(3)
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Not Applicable
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(a)(4)
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Not Applicable
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(a)(5)
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609
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(b)
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608
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610
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§ 311
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(a)
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613(a)
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(b)
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613(b)
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(b)(2)
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703(a)(2)
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703(b)
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§ 312
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(a)
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701
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702(a)
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(b)
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702(b)
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(c)
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702(c)
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§ 313
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(a)
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703(a)
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(b)
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703(b)
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(c)
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703(a), 703(b)
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(d)
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703(c)
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§ 314
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(a)
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704
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(b)
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Not Applicable
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(c)(1)
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102
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(c)(2)
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102
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(c)(3)
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Not Applicable
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(d)
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Not Applicable
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(e)
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102
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§ 315
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(a)
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601(a)
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(b)
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602
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703(a)(7)
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(c)
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601(b)
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(d)
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601(c)
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(d)(l)
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601(a)(1)
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(d)(2)
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601(c)(2)
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(d)(3)
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601(c)(3)
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(e)
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514
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§ 316
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(a)
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101
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(a)(1)(A)
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502
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512
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(a)(1)(B)
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513
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(a)(2)
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Not Applicable
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(b)
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508
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(c)
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104(g)
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§ 317
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(a)(l)
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503
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(a)(2)
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504
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(b)
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1003
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§ 318
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(a)
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107
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Note: This reconciliation and tie shall not, for any purpose, be deemed
to be a part of the Indenture.
