JA Energy (the “Company”, “we”,
“us”, or “our”) is providing to you the following Information Statement to notify you that our Board of
Directors and the holders of a majority of our outstanding shares of common stock have executed and delivered a written consent
to effect the following corporate actions.
INFORMATION STATEMENT
PURSUANT TO SECTION 14 OF THE SECURITIES
AND EXCHANGE ACT OF 1934,
AS AMENDED, AND REGULATION 14C AND SCHEDULE
14C THEREUNDER
This Information Statement is being mailed
to inform the stockholders of action taken without a meeting upon the written consent of the holders of a majority of the outstanding
shares of the common stock of the Company.
WE ARE NOT ASKING YOU FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY.
GENERAL INFORMATION
This Information
Statement has been filed with the U. S. Securities and Exchange Commission and is being furnished, pursuant to Section 14C of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), to the holders (the “Stockholders”) of
the common stock, par value $0.001 per share (the “Common Stock”), of
JA Energy
,
a Nevada corporation (the “Company”), to notify such Stockholders of the following:
On or about October
11, 2016, the Company received written consents from seven shareholders in lieu of a meeting of Stockholders. These shareholders
own 30,087,129 Class A Common Shares and 6,000,000 Class B Common Shares representing approximately 99.85% of the
voting
class
(the “Majority Stockholder”) authorizing the Company’s Board of Directors, to
change its corporate name to
UBI Blockchain Internet, LTD
from
JA Energy
and increasing the number of authorized share to 200,000,000 from 75,000,000,
while retaining the current par value of $0.001
.
Percentage of total voting power represents voting power with respect to all shares of our Class A Common Stock (30,217,046
issued and outstanding) and Class B Voting stock (6,000,000 shares issued and outstanding), as a single class. The holder of our
Class B Voting Stock are entitled to ten votes per share, and holders of our Class A Common Stock are entitled to one vote per
share. The 6,000,000 Class B shares have voting rights equal to 60,000,000 common shares. Percentage of Total Voting Power is calculated
based on an aggregate of 90,217,046 (30,217,046 Class A Common + 60,000,000 Class B Voting Common) shares issued and outstanding.
On October 10, 2016,
the Board of Directors of the Company approved the above-mentioned actions, subject to Stockholder approval. The Majority Stockholder
approved the action by written consent in lieu of a meeting on October 11, 2016, in accordance with the
Nevada Corporate
law
. Accordingly, your consent is not required and is not being solicited in connection with the approval
of the action.
The elimination of the need for a special meeting
of the shareholders to approve the corporate name change and increase of authorized shares is authorized by Section 78.320 of the
Nevada Revised Statutes, (the "Nevada Law"). This Section provides that the written consent of the holders of outstanding
shares of voting capital stock, having not less than the minimum number of votes which would be necessary to authorize or take
the action at a meeting at which all shares entitled to vote on a matter were present and voted, may be substituted for the special
meeting. According to Section 78.390 of the Nevada Law, a majority of the outstanding shares of voting capital stock entitled to
vote on the matter is required in order to amend the Company's Articles of Incorporation. In order to eliminate the costs and management
time involved in holding a special meeting and in order to effect the corporate name change and increase the number of authorized
shares in order to accomplish the purposes of the Company, the Board of Directors of the Company voted to utilize the written consent
of the majority shareholders of the Company.
2
CORPORATE ACTION #1
Corporate
Name Change to: UBI Blockchain Internet, LTD.
Our Board of Directors and majority shareholders
approved a corporate name change from to “UBI Blockchain Internet, LTD” from “JA Energy.” Management believes
that changing our name to UBI Blockchain Internet, LTD will give the Company an improved identity.
Once we complete the name change, we will need
to apply for a new Over-the-Counter Bulletin Board trading symbol and CUSIP number. We will report our new symbol and CUSIP number
in a Current Report on Form 8-K once it is established.
The Company's Articles of Incorporation shall
be filed with the Delaware Secretary of State so that Article 1 of the Certificate of Incorporation shall be as follows:
ARTICLE ONE
1. The name of corporation is: UBI Blockchain Internet, LTD
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors
of the Company believes that the stockholders of the Company will benefit from the corporate name which will
give the Company
a new identity
. No assurances the corporate name change will have any effect on the business.
CORPORATE ACTION #2
Change
our State of Incorporation
From
Nevada to Delaware
Overview
On October 5, 2016, the Board unanimously approved
and, by written consent, the Consenting Stockholders approved, the Plan of Conversion pursuant to which the Company will effect
the Reincorporation, in compliance with the Delaware General Corporation law and the NRS.
Principal Reasons for the Reincorporation Under Delaware Law
Corporate Law
As we plan for the future, the Board and management
believe that it is in the best interest of the Company to be able to draw upon well-established principles of corporate governance
in making legal and business decisions. The prominence and predictability of Delaware corporate law provide a reliable foundation
on which the Company's governance decisions can be based. The Board believes that the stockholders will benefit from the responsiveness
of the Delaware corporate law. With the Reincorporation to Delaware, the By-laws of the Company will remain unchanged.
3
For many years, Delaware has followed a policy
of encouraging incorporation in Delaware and, in furtherance of that policy, has been the leader in adopting, construing and implementing
comprehensive, flexible corporate laws that are responsive to the legal and business needs of the corporations organized under
Delaware law. Unlike most states, including Nevada, Delaware has established progressive principles of corporate governance that
the Company could draw upon when making business and legal decisions.
To take advantage of Delaware’s flexible
and responsive corporate laws, many corporations choose to incorporate initially in Delaware or choose to reincorporate into Delaware,
as the Company proposes to do. In general, the Board believes that Delaware provides a more appropriate and flexible corporate
and legal environment in which to operate than currently exists in the State of Nevada and that the Company and its stockholders
would benefit from such an environment. The Board has considered the following benefits available to Delaware corporations in deciding
to propose reincorporation in Delaware:
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the General Corporation Law of the State of Delaware, which is generally acknowledged to be the most advanced and flexible corporate statute in the country;
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the responsiveness and efficiency of the Division of Corporations of the Secretary of State of Delaware;
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the Delaware General Assembly, which each year considers and adopts statutory amendments that the Corporation Law Section of the Delaware State Bar Association proposes in an effort to ensure that the corporate statute continues to be responsive to the changing needs of businesses;
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the Delaware Court of Chancery, which handles complex corporate issues with a level of experience and a degree of sophistication and understanding unmatched by any other court in the country, and the Delaware Supreme Court, which is highly regarded; and
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the well-established body of case law construing Delaware law, which has developed over the last century and which provides businesses with a greater degree of predictability than most, if not all, other jurisdictions provide.
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Additionally, management believes that, as
a Delaware corporation, the Company would be better able to continue to attract and retain qualified directors and officers than
it would be able to as an Nevada corporation, in part, because Delaware law provides more predictability with respect to the issue
of liability of directors and officers than Nevada law does. The increasing frequency of claims against directors and officers
that are litigated has greatly expanded the risks to directors and officers of exercising their respective duties. The amount of
time and money required to respond to and litigate such claims can be substantial. Although Nevada law and Delaware law both permit
a corporation to include a provision in the corporation’s articles or certificate, as the case may be, of incorporation that
in certain circumstances reduces or limits the monetary liability of directors for breaches of their fiduciary duty of care, Delaware
law, as stated above, provides to directors and officers more predictability than Nevada law does and, therefore, provides directors
and officers of a Delaware corporation a greater degree of comfort as to their risk of liability than that afforded under Nevada
law. As the Company plans for the future, the board of directors and management believe that it is essential to be able to draw
upon well-established principles of corporate governance in making legal and business decisions. The prominence and predictability
of Delaware corporate law provide a reliable foundation on which the Company's governance decisions can be based.
4
Capital Raising
Delaware is a recognized and understood jurisdiction
throughout the international financial community. The Company would be better positioned to raise capital both within and outside
of the United States by being incorporated in Delaware. The Board believes that the Company will be best suited to pursue all available
financing options in the best interests of its stockholders if the Company is incorporated in Delaware versus Nevada. The Board
believes that the Reincorporation will represent a better opportunity for the Company to increase stockholder value.
Any stockholders that votes against the Reincorporation
may, under certain conditions, become entitled to be paid for his or her shares of the Corporation's capital stock in lieu of receiving
shares of the Delaware Corp. Under Nevada Law Section 92A.380, you, the Company’s stockholder, have the right to dissent
from the Reincorporation and demand payment of the fair value of your shares of the Company’s capital stock and are urged
to read the full text of the Nevada dissenters' rights statute, which is reprinted in its entirety and attached as Appendix E to
this Information Statement.
Disadvantages of Reincorporation in Delaware
While our Board believe that the foregoing
benefits and advantages of the Reincorporation into Delaware are significant, you may find the Reincorporation disadvantageous.
The Delaware General Corporation Law permits a corporation to adopt a number of measures, through amendment of the corporate certificate
of incorporation or bylaws or otherwise, designed to reduce a corporation's vulnerability to unsolicited takeover attempts. There
is substantial judicial precedent in the Delaware courts as to the legal principles applicable to such defensive measures with
respect to the conduct of the board of directors under the business judgment rule, and the related enhanced scrutiny standard of
judicial review, with respect to unsolicited takeover attempts. The substantial judicial precedent in the Delaware courts may potentially
be disadvantageous to you to the extent it has the effect of providing greater certainty that the Delaware courts will sustain
the measures the Company has in place or implements to protect stockholder interests in the event of unsolicited takeover attempts.
Such measures may also tend to discourage a future attempt to acquire control of the Company that is not presented to and approved
by the Company’s Board, but that a substantial number and perhaps even a majority of the stockholders might believe to be
in their best interests or in which stockholders might receive a substantial premium for their shares over then current market
prices. As a result of such effects, stockholders who might desire to participate in such a transaction may not have
an opportunity to do so.
We intend to effect the Reincorporation pursuant
to the Plan of Conversion in substantially the form attached hereto as Appendix A. The Plan of Conversion provides that the Company
will convert from a Nevada corporation to a Delaware corporation (“
Delaware Corp
”) and thereafter be subject
to the laws of the State of Delaware. The Reincorporation would be considered, in effect, a continuation of existence of the Company,
with the existence of Delaware Corp deemed to have commenced when the Company was first formed in Nevada.
5
General actions that will occur pursuant to the Plan of Conversion
Pursuant to the Plan of Conversion, Delaware General Corporate Law,
as amended (the “
DGCL
”), and the NRS, upon conversion:
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The Company will cease to be governed by the NRS and will be deemed a Delaware corporation subject to the DGCL;
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Delaware Corp will be deemed to be the same entity as the Company for all purposes under the laws of Delaware, with the Company’s existence deemed to have commenced when the Company was first formed in Nevada;
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Delaware Corp will continue to have all of the assets of the Company;
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Delaware Corp will continue to have all the debts, liabilities and duties of the Company; and
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Each director and officer of the Company will continue to hold their respective offices with Delaware Corp.
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Approval of the Filing of the Articles of Conversion and the
Certificate of Conversion
Pursuant to the Plan of Conversion and in connection
with the Reincorporation, the Board and the Consenting Stockholders approved the filing: (1) with the Secretary of State of the
State of Nevada articles of conversion, in substantially the form attached hereto as Appendix B (“
Articles of Conversion
”);
(2) with the Secretary of State of the State of Delaware a certificate of conversion in substantially the form attached hereto
as Appendix C (the “
Certificate of Conversion
”); and (3) the Certificate of Incorporation, substantially in
the form attached hereto as Appendix D.
Adoption of Delaware Certificate of Incorporation
In connection with the Reincorporation, the
Board and the Consenting Stockholders adopted the Certificate of Incorporation in substantially the form attached hereto as
Appendix
D.
At the time they become effective, the Certificate of Incorporation will supersede the Company’s current articles
of incorporation. The Certificate of Incorporation were adopted in order to reflect the Reincorporation of the Company in the State
of Delaware and to implement provisions deemed by the Board to be in the best interests of the Company and its stockholders.
Effect on the Company’s Securities
Common Stock
Following the reincorporation to Delaware,
the authorized capital stock of the Company will consist of 200,000,000 shares of common stock, par value $0.001 per share. There
will be three Classes of Common Shares consisting of: 130,000,000 authorized shares of Class A Common Stock, $0.001 par value per
share (“Class A Common Stock”), 6,000,000 authorized shares of Class B Common Stock, $0.001 par value per share (“Class
B Common Stock” and together with the Class A Common Stock, the “Common Stock”), 64,000,000 authorized shares
of Class C Capital Stock, $0.001 par value per share (“Class C Capital Stock” and together with the Common Stock, the
“Capital Stock”).
6
Pursuant to the Plan of Conversion, each share
of common stock of the Company, $0.001 par value per share, that is issued and outstanding immediately prior to the Reincorporation
will automatically convert into one share of common stock, $0.001 par value per share of Delaware Corp.
Anti-Takeover Implications
Both Nevada and Delaware permit a corporation
to include in its certificate of incorporation or bylaws or to otherwise adopt measures designed to reduce a corporation’s
vulnerability to unsolicited takeover attempts. The Board, however, is not proposing the Reincorporation to prevent a change in
control of the Company.
With respect to implementing defensive strategies,
Delaware law is preferable to Nevada law because of the substantial judicial precedent on the legal principles applicable to defensive
strategies. As a Nevada corporation or a Delaware corporation, the Company could implement some of the same defensive measures.
As a Delaware corporation, however, the Company would benefit from the predictability of Delaware law on such matters.
For a discussion of differences between Nevada
and Delaware law see “Changes to Stockholder Rights Before and After the Reincorporation–Changes from Nevada to Delaware
Law–Business Combinations; – Control Share Acquisitions” below.
Changes to Stockholder Rights Before and After the Reincorporation
As previously noted, the Certificate of Incorporation
and Delaware Bylaws will be the governing instruments of the Company following the Reincorporation, resulting in some changes from
the Company’s current articles of incorporation, which are primarily procedural in nature, such as a change in the registered
office and agent of the Company from an office and agent in Nevada to an office and agent in Delaware. There are also material
differences between the DGCL and the NRS. Certain changes to the articles of incorporation of the Company, as well as the material
differences between Delaware and Nevada law are discussed below. The following summary does not purport to be complete and is qualified
in its entirety by reference to Delaware and Nevada corporate laws, the Certificate of Incorporation and Delaware Bylaws, copies
of which are attached hereto as
Appendix D
and
Appendix E
, respectively.
7
Changes From Nevada Law to Delaware Law
Set forth below is a table summarizing the
material differences in the rights of the stockholders of the Company before and after the Reincorporation is effective, as a result
of the differences between Nevada law and Delaware law. This chart does not address each difference between Delaware law and Nevada
law, but focuses on some of those differences which the Company believes are most relevant to the existing stockholders. This chart
is not intended as an exhaustive list of all differences, and is qualified in its entirety by reference to Delaware and Nevada
law.
Provision
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Nevada Law
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Delaware Law
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Filling Vacancies on
the Board of Directors
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Nevada corporate law provides that all vacancies, including those caused by an increase in the number of directors, may be filled by a majority of the remaining directors, though less than a quorum, unless it is otherwise provided in the articles of incorporation. Unless otherwise provided in the articles of incorporation, pursuant to a resignation by a director, the board may fill the vacancy or vacancies with each director so appointed to hold office during the remainder of the term of office of the resigning director or directors.
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Delaware law provides that, unless otherwise provided in the certificate of incorporation or bylaws of a corporation, vacancies may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director. Further, if, at the time of filling any vacancy, the directors then in office shall constitute less than a majority of the whole board, the Delaware Court of Chancery may, upon application of any stockholder or stockholders holding at least 10% of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office.
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Provision
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Nevada Law
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Delaware Law
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Special Meetings of
Stockholders
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Under Nevada law, unless otherwise provided in the articles of incorporation or bylaws, the entire board of directors, any two directors or the president may call annual and special meetings of the stockholders and directors.
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Under Delaware law, a special meeting of stockholders may be called by the board of directors or by such persons as may be authorized by the certificate of incorporation or by the bylaws.
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Failure to Hold an Annual
Meeting of Stockholders
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Nevada law provides that if a corporation fails to elect directors within 18 months after the last election of directors, a Nevada district court will have jurisdiction in equity and may order an election upon petition of one or more stockholders holding at least 15% of the voting power.
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Delaware law provides that if an annual meeting for election of directors is not held on the date designated or an action by written consent to elect directors in lieu of an annual meeting has not been taken within 30 days after the date designated for the annual meeting, or if no date has been designated, for a period of 13 months after the latest to occur of the organization of the corporation, its last annual meeting or the last action by written consent to elect directors in lieu of an annual meeting, the Court of Chancery may summarily order a meeting to be held upon the application of any stockholder or director.
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Limitation on Director
Liability
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Under Nevada law, unless the articles of incorporation or an amendment thereto (filed on or after October 1, 2003) provides for greater individual liability, a director or officer is not individually liable to the corporation or its stockholders or creditors for any damages as a result of any act or failure to act in his or her capacity as a director or officer unless it is proven that: (a) the director’s or officer’s act or
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Under Delaware law, if a corporation’s certificate of incorporation so provides, the personal liability of a director for breach of fiduciary duty as a director may be eliminated or limited. A corporation’s certificate of incorporation, however, may not limit or eliminate a director’s personal liability (a) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (b) for acts or omissions not in good faith or involving intentional misconduct or a knowing violation of law, (c) for the payment of unlawful dividends, stock repurchases or redemptions, or (d) for any transaction in which the director received an
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Provision
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Nevada Law
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Delaware Law
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failure to act constituted a breach of his or her fiduciary duties as a director or officer; and (b) the breach of those duties involved intentional misconduct, fraud or a knowing violation of law.
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improper personal benefit.
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Indemnification
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Under Nevada law, a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with the action, suit or proceeding if the person: (a) is not liable pursuant to NRS 78.138; or (b) acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the conduct was unlawful. However, indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought
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Under Delaware law, a corporation may indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that
the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person
in connection with such action, suit or proceeding if: the person acted in good faith and in a manner the person reasonably
believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe the person's conduct was unlawful. With respect to actions by or in the right of the corporation,
no indemnification shall be made with respect to any claim, issue or matter as to which such person shall have been adjudged to
be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit
is brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper. A
director or officer who is successful, on the merits or otherwise, in defense of any proceeding subject to the Delaware corporate
statutes’ indemnification provisions shall be indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection therewith.
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Provision
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Nevada Law
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Delaware Law
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determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper. To the extent that such person has been successful on the merits or otherwise in defense of any proceeding subject to the Nevada indemnification laws, the corporation shall indemnify him or her against expenses, including attorneys’ fees, actually and reasonably incurred by him or her in connection with the defense.
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Advancement of
Expenses
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Nevada law provides that the articles of incorporation, the bylaws or an agreement made by the corporation may provide that the expenses of officers and directors incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding, upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that the director or officer is not entitled to be indemnified by the corporation.
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Delaware law provides that expenses incurred by an officer or director of the corporation in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it is ultimately determined that such person is not entitled to be indemnified by the corporation as authorized under the indemnification laws of Delaware. Such expenses may be so paid upon such terms and conditions as the corporation deems appropriate. Under Delaware law, unless otherwise provided in its certificate of incorporation or bylaws, a corporation has the discretion whether or not to advance expenses.
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Provision
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Nevada Law
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Delaware Law
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Declaration and Payment
of Dividends
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Under Nevada law, except as otherwise provided in the articles of incorporation, a board of directors may authorize and the corporation may make distributions to its stockholders, including distributions on shares that are partially paid. However, no distribution may be made if, after giving effect to such distribution: (a) the corporation would not be able to pay its debts as they become due in the usual course of business; or (b) except as otherwise specifically allowed by the articles of incorporation, the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to those receiving the distribution.
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Under Delaware law, subject to any restriction contained in a corporation's certificate of incorporation, the board of directors may declare, and the corporation may pay, dividends or other distributions upon the shares of its capital stock either (a) out of "surplus" or (b) in the event that there is no surplus, out of the net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year, unless net assets (total assets in excess of total liabilities) are less than the capital of all outstanding preferred stock. "Surplus" is defined as the excess of the net assets of the corporation over the amount determined to be the capital of the corporation by the board of directors (which amount cannot be less than the aggregate par value of all issued shares of capital stock).
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Provision
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Nevada Law
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Delaware Law
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Business Combinations
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Nevada law prohibits certain business combinations between a Nevada corporation and an interested stockholder for three years after such person becomes an interested stockholder. Generally, an interested stockholder is a holder who is the beneficial owner of 10% or more of the voting power of a corporation’s outstanding stock and at any time within three years immediately before the date in question was the beneficial owner of 10% or more of the then outstanding stock of the corporation. After the three year period, business combinations remain prohibited unless they are (a) approved by the board of directors prior to the date that the person first became an interested stockholder or a majority of the outstanding voting power not beneficially owned by the interested party, or (b) the interested stockholder satisfies certain fair-value requirements. An interested stockholder is (i) a person that beneficially owns, directly or indirectly, 10% or more of the voting power of the outstanding voting shares of a corporation, or (ii) an affiliate or associate of the corporation who, at any time within the past three years, was an interested stockholder of the corporation.
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Delaware law prohibits, in certain circumstances, a “business combination” between the corporation and an “interested stockholder” within three years of the stockholder becoming an “interested stockholder.” Generally, an “interested stockholder” is a holder who, directly or indirectly, controls 15% or more of the outstanding voting stock or is an affiliate of the corporation and was the owner of 15% or more of the outstanding voting stock at any time within the three-year period prior to the date upon which the status of an “interested stockholder” is being determined. A “business combination” includes a merger or consolidation, a sale or other disposition of assets having an aggregate market value equal to 10% or more of the consolidated assets of the corporation or the aggregate market value of the outstanding stock of the corporation and certain transactions that would increase the interested stockholder’s proportionate share ownership in the corporation. This provision does not apply where, among other things, (i) the transaction which resulted in the individual becoming an interested stockholder is approved by the corporation’s board of directors prior to the date the interested stockholder acquired such 15% interest, (ii) upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the outstanding voting stock of the corporation at the time the transaction commenced, or (iii) at or after the date the person becomes an interested stockholder, the business combination is approved by a majority of the board of directors of the corporation and an affirmative vote of at least 66 2/3% of the outstanding voting stock at an annual or special meeting and not by written consent, excluding stock not owned by the interested stockholder. This provision also does not apply if a stockholder acquires a 15% interest inadvertently and divests itself of such ownership and would not have been a 15% stockholder in the preceding three years but for the inadvertent acquisition of ownership.
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Provision
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Nevada Law
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Delaware Law
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Control Share Acquisition
Statute
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Under Nevada law, an acquiring person who acquires a controlling
interest in an issuing corporation is prohibited from exercise voting rights on any control shares unless such voting rights are
conferred by a majority vote of the disinterested stockholders of the issuing corporation at a special or annual meeting of stockholders. Unless
otherwise provided in the articles of incorporation or the bylaws, if the control shares are accorded full voting rights and the
acquiring person acquires control shares with a majority or more of all the voting power, any stockholder, other than the acquiring
person, who does not vote in favor of authorizing voting rights for the control shares is entitled to dissent and demand payment
of the fair value of his or her shares.
A controlling interest means the ownership of outstanding voting
shares of an issuing corporation sufficient to enable the acquiring person, directly or indirectly and individually
or in association with others, to exercise: (i) one-fifth or more but less than one-third; (ii) one-third or more but less than
a majority; or (iii) a majority or more, of all the voting power of the corporation in the election of directors. Control
shares means those outstanding voting shares of an issuing corporation which an acquiring person: (a) acquires in an
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Delaware’s control share acquisition statute generally provides
that shares acquired in a “control share acquisition” will not possess any voting rights unless either the board of
directors approves the acquisition or such voting rights are approved by a majority of the corporation’s voting shares, excluding
interested shares. Interested shares are those held by a corporation’s officers and inside directors and by the acquiring
party. A “control share acquisition” is an acquisition, directly or indirectly, by any person of ownership of, or the
power to direct the exercise of voting power with respect to, issued and outstanding “control shares” of a publicly
held Delaware corporation. “Control shares” are shares that, except for Delaware’s control share acquisition
statute, would have voting power that, when added to all other shares that can be voted by the acquiring party, would entitle the
acquiring party, immediately after the acquisition of such shares, directly or indirectly, to exercise voting power in the election
of directors within any of the following ranges: (1) at least 20% but less than 33 1/3% of all voting power; (2) at least 33 1/3%
but less than a majority of all voting power; or (3) a majority or more of all voting power.
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Provision
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Nevada Law
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Delaware Law
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acquisition or offer to acquire in an acquisition;
and (b) acquires within 90 days immediately preceding the date when the acquiring person became an acquiring person.
The control share acquisition statute applies
to any acquisition of a controlling interest in an issuing corporation unless the articles of incorporation or bylaws of the corporation
in effect on the 10th day following the acquisition of a controlling interest by an acquiring person provide that the provisions
of those sections do not apply.
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Taxes and Fees
|
Nevada charges corporations incorporated in Nevada nominal annual corporate fees based on the value of the corporation’s authorized stock with a maximum fee of $35,000, as well as a $200 business license fee, and does not impose any franchise taxes on corporations.
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Delaware imposes annual franchise tax fees on all corporations incorporated in Delaware. The annual fee ranges from a nominal fee to a maximum of $180,000, based on an equation consisting of the number of shares authorized, the number of shares outstanding and the net assets of the corporation.
|
15
Changes to Articles of Incorporation
Set forth below is a table summarizing the
material differences in the rights of the stockholders of the Company before and after the Reincorporation is effective, as a result
of the differences between the Company’s Articles of Incorporation and the Certificate of Incorporation. This chart does
not address each difference between the Articles of Incorporation and the Certificate of Incorporation, but focuses on some of
those differences which the Company believes are most relevant to the existing stockholders.
Provision
|
Articles of Incorporation
|
Certificate of Incorporation
|
Impact on Stockholders
|
|
|
|
|
Removal of Directors
|
Not Addressed
|
The Certificate of Incorporation states that
any director of the Company’s board of directors or the entire board of directors may be removed at any time, with or without
cause, by the holders of at least sixty-six and two-thirds percent (66 2/3%) of the shares entitled to vote at an election of directors
|
Under Delaware law, the default provision for
the removal of directors of a corporation is that directors may be removed with or without cause upon the affirmative vote of a
majority of all of the votes of the class entitled to elect that director unless the charter or certificate of incorporation provides
otherwise.
The Certificate of Incorporation increases
the threshold for the removal of directors to sixty-six and two-thirds percent (66 2/3%) which will impact our stockholders by
making it more difficult for them to change the Board’s composition.
|
16
Provision
|
Articles of Incorporation
|
Certificate of Incorporation
|
Impact on Stockholders
|
|
|
|
|
Indemnification and Advancement of Expenses
|
Not Addressed in Articles of Incorporation
|
The Certificate of Incorporation states that the Company shall indemnify, advance expenses, and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (a “
Covered Person
”) who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “
Proceeding
”), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Company or, while a director or officer of the Company, is or was serving at the request of the Company as a director, officer, employee or agent of another Company or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such Covered Person. Notwithstanding the preceding sentence, except for claims for indemnification (following the final disposition of such Proceeding) or advancement of expenses not paid in full, the Company shall be required to indemnify a Covered Person in connection with a Proceeding (or part thereof) commenced by such Covered Person only if the commencement of such Proceeding (or part thereof) by the Covered Person was authorized in the specific case by the Board of the Company.
|
Section 145(e) of the DGCL permits, but does
not require Delaware corporations to pay, prior to final disposition, the expenses, including attorneys’ fees, incurred by
a corporate representative in defending a proceeding. The provision in Delaware Bylaws and the Certificate of Incorporation
permitting such advances of fees associated with indemnification is not the default provision under the DGCL.
Advancing expenses to Covered Persons prior
to the final disposition of a proceeding could impact our stockholders to the extent that we would use Company assets, which could
otherwise be used to grow our business and increase stockholder equity, to cover the costs of litigation without the
certainty that the Covered Person will be successful on the merits of the suit.
|
17
Provision
|
Articles of Incorporation
|
Certificate of Incorporation
|
Impact on Stockholders
|
Choice of Forum
|
Not Addressed
|
The Certificate of Incorporation states that unless the Company consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim for breach of a fiduciary duty owed by any director, officer, employee or agent of the Company to the Company or the Company's stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, the Certificate of Incorporation or the Delaware Bylaws or (iv) any action asserting a claim governed by the internal affairs doctrine, in each case subject to said Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein.
|
The Delaware Chancery Court is widely regarded as the country’s
preeminent business court, with experienced jurists who have deep understanding of Delaware corporate law and long standing precedent
regarding corporations’ governance. The inclusion of the provision in the Certificate of Incorporation designating
the Delaware Chancery Court as the forum for actions against the Company, may make it more difficult for small stockholders
that reside in states other than Delaware to initiate suits against the Company or any director, officer or employee of the Company
The inclusion of a choice of forum provision in a corporation’s
certificate of incorporation is not a default provision under the DGCL.
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18
Provision
|
Articles of Incorporation
|
Certificate of Incorporation
|
Impact on Stockholders
|
|
|
|
of our stockholders without first amending the powers conferred
to the Board to amend or repeal the Delaware Bylaws.
Conferring the power to amend or repeal the Delaware Bylaws to the
Board is not the default under the DGCL.
|
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board believes
that the stockholders of the Company will benefit from the change of Reincorporation from Nevada to Delaware, as they believe the
Company will be able to draw upon well-established principles of corporate governance in making legal and business decisions
19
CORPORATE ACTION #3
PURPOSE
AND EFFECT OF AMENDMENT OF THE ARTICLES OF INCORPORATION
TO
Increase the Number of Authorized Shares
PURPOSE OF INCREASING NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
The Company's Board of Directors recognizes
that it is desirable to have additional authorized shares of Common Stock available for possible future financings, possible future
acquisition transactions and other general corporate purposes. The Company's Board of Directors believes that having such additional
authorized shares of Common Stock available for issuance in the future should give the Company greater flexibility and may allow
such shares to be issued without the expense and delay of a special shareholders' meeting. Although such issuance of additional
shares with respect to future financings and acquisitions would dilute existing shareholders, management believes that such transactions
would increase the value of the Company to its shareholders. The increase in authorized common stock and preferred stock will not
have any immediate effect on the rights of existing stockholders. However, the Board of Directors will have the authority to issue
authorized common stock or preferred stock without requiring future stockholder approval of such issuances, except as may be required
by the Articles of Incorporation or applicable law.
The proposed increase in the authorized number
of shares of Common Stock could have a number of effects on the Company's stockholders depending upon the exact nature and circumstances
of any actual issuances of authorized but unissued shares. The increase could have an anti-takeover effect, in that additional
shares could be issued (within the limits imposed by applicable law) in one or more transactions that could make a change in control
or takeover of the Company more difficult. For example, additional shares could be issued by the Company so as to dilute the stock
ownership or voting rights of persons seeking to obtain control of the Company. Any such issuance of additional stock could have
the effect of diluting the earnings per share and book value per share of outstanding shares of common stock or preferred stock
and such additional shares could be used to dilute the stock ownership or voting rights of a person seeking to obtain control of
the Company. Similarly, the issuance of additional shares to certain persons allied with the Company's management could have the
effect of making it more difficult to remove the Company's current management by diluting the stock ownership or voting rights
of persons seeking to cause such removal. The Board of Directors is not aware of any attempt, or contemplated attempt, to acquire
control of the Company, and this action is not being undertaken with the intent that it be utilized as a type of anti-takeover
device.
The board of directors of JA Energy may authorize,
without further shareholder approval, the issuance of such shares of common stock or preferred stock to such persons, for such
consideration, and upon such terms as the board of directors determines. Such issuance could result in a significant dilution of
the voting rights and the stockholders' equity, of then existing shareholders.
Issuance of additional common stock may have
the effect of deterring or thwarting persons seeking to take control of JA Energy through a tender offer, proxy fight or otherwise
or to bring about removal of incumbent management or a corporate transaction such as merger. For example, the issuance of common
stock or preferred stock could be used to deter or prevent such a change of control through dilution of stock ownership of persons
seeking to take control or by rendering a transaction proposed by such persons more difficult.
20
The Company has an outstanding Subscription
Agreement from UBI Blockchain Internet, LTD, a Hong Kong Company to purchase 40,000,000 Class C Common Shares. The Class C shares
have been designated and have no voting rights. The Class C Common shares cannot be issued until the number of authorized shares
are increased.
The Company's Certificate of Incorporation
shall be filed with the Delaware Secretary of State so that Article 4 of the Certificate of Incorporation shall be as follows:
ARTICLE 4
"The total number of shares of all classes
of capital stock that the corporation has authority to issue is a total of 200,000,000 shares, consisting of: 130,000,000 authorized
shares of Class A Common Stock, $0.001 par value per share (“
Class A Common Stock
”), 6,000,000 authorized
shares of Class B Common Stock, $0.001 par value per share (“
Class B Common Stock
” and together with
the Class A Common Stock, the “
Common Stock
”), 64,000,000 shares of Class C Capital Stock, $0.001 par
value per share (“
Class C Capital Stock
” and together with the Common Stock, the “
Capital
Stock
”). The number of authorized shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock may
be increased or decreased by the affirmative vote of the holders of capital stock representing a majority of the voting power of
all the then-outstanding shares of capital stock of the corporation entitled to vote thereon, irrespective of the provisions of
Section 242(b)(2) of the General Corporation Law." (See Appendix D.)
The Company has designed three Classes of Common
Stock. Class A Common Stock, Class B Common Stock which carries a voting weight equal to ten (10) Common Shares. The Class B shares
can be converted into fully paid and nonassessable Common Shares, on a one-to-one basis, at the option of the holder at any time
upon written notice to the Company and its authorized transfers agent. And, Class C Common Stock which has no voting rights.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board believes that the stockholders of
the Company will benefit from an increase in the number of authorized shares, in order to accommodate future financing or other
corporate purposes. No assurances can be given that future financing will be found.
Security Ownership of Certain
Beneficial Owners and Management
The following table sets forth certain information
with respect to the beneficial ownership of our common stock as of October 31, 2016, for: a) each stockholder known by us to be
the beneficial owner of more than 5% of our outstanding shares of Class A common stock or Class B common stock; b) each of our
directors; c) each of our named executive officers; and d) all of our directors and executive officers as a group. We have determined
beneficial ownership in accordance with the rules of the U. S. Securities and Exchange Commission. Except as indicated by the footnotes
below, we believe, based on the information furnished to us, that the persons and entities named in the following table have sole
voting and investment power with respect to all shares of Class A common stock or Class B common stock that they beneficially own.
Applicable percentage ownership is based on 30,217,046 shares of Class A common stock and 6,000,000 shares of Class B common stock
outstanding at October 31, 2016. With the exception of Class B shares, that can convert one a 1-for-1 basis for fully paid and
nonassessable Class A Common Stock, at the option of the holder at any time upon written notice to the Company and its authorized
transfers agent, we do not have any outstanding options, warrants or other securities exercisable for or convertible into shares
of our common stock.
21
Shares Beneficially Owned
|
|
% of Total
Voting
Power
(1)
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Class A Common
|
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Class B Common
|
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Name of Beneficial Owner
|
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Shares
|
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%
|
|
Voting Shares
|
|
%
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Named Executive Officers and Directors:
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Barry Hall (2)
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0
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-%
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0
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-%
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-%
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Frank Arnone (3)
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0
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-%
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0
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-%
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-%
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All executive officers and directors as a group (2 persons)
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0
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-%
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0
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-%
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-%
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Other 5% Stockholders
|
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|
UBI Blockchain
Internet LTD (4)
|
|
30,000,000
|
|
|
99.3%
|
|
|
6,000,000
|
100%
|
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99.8%
|
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(1) Percentage of total voting power represents
voting power with respect to all shares of our Class A Common Stock (30,217,046 issued and outstanding) and Class B Voting stock
(6,000,000 shares issued and outstanding), as a single class. The holder of our Class B Voting Stock are entitled to ten votes
per share, and holders of our Class A Common Stock are entitled to one vote per share. The 6,000,000 Class B shares have voting
rights equal to 60,000,000 common shares. Percentage of Total Voting Power is calculated based on an aggregate of 90,217,046 (30,217,046
Class A Common + 60,000,000 Class B Voting Common) shares issued and outstanding.
2) Barry Hall, 8250 W. Charleston Blvd, Suite 110. Las Vegas, NV
89117.
3) Frank Arnone, 8250 W. Charleston Blvd, Suite 110. Las Vegas,
NV 89117.
4) UBI Blockchain Internet, LTD, Smart-Space
3F, Level 9, Cyberport 3, 100 Cyberport Road, Hong Kong, People's Republic of China. Tony Liu is the beneficial owner who
exercises
the sole voting and
dispositive powers with respect to the shares owned and has the ultimate voting control over the shares
held this entity. Not included in the above totals are 40,000,000 Class C Non-Voting Common Stock to be issued, once the number
of authorized shares are increased from 70,000,000 to 200,000,000.
We are not aware of any arrangements that may
result in "changes in control" as that term is defined by the provisions of Item 403(c) of Regulation S-B.
We believe that all persons named have full
voting and investment power with respect to the shares indicated, unless otherwise noted in the table. Under the rules of the U.
S. Securities and Exchange Commission, a person (or group of persons) is deemed to be a "beneficial owner" of a security
if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to
dispose of or to direct the disposition of such security. Accordingly, more than one person may be deemed to be a beneficial owner
of the same security. A person is also deemed to be a beneficial owner of any security, which that person has the right to acquire
within 60-days, such as options or warrants to purchase our common stock.
22
Nevada Anti-Takeover Provisions
The anti-takeover provisions of Sections 78.411
through 78.445 of the Nevada Corporation Law apply to JA Energy. Section 78.438 of the Nevada law prohibits the Company from merging
with or selling more than 5% of our assets or stock to any shareholder who owns or owned more than 10% of any stock or any entity
related to a 10% shareholder for three years after the date on which the shareholder acquired the JA Energy shares, unless the
transaction is approved by JA Energy's Board of Directors. The provisions also prohibit JA Energy from completing any of the transactions
described in the preceding sentence with a 10% shareholder who has held the shares more than three years and its related entities
unless the transaction is approved by our Board of Directors or a majority of our shares, other than shares owned by that 10% shareholder
or any related entity. These provisions could delay, defer or prevent a change in control of JA Energy.
Expenses of Solicitation
The Company will pay all costs associated with the distribution
of this Information Statement, including the costs of printing and mailing. The Company has asked or will ask brokers and other
custodians, nominees and fiduciaries to forward this Information Statement to the beneficial owners of the Common Stock held of
record by such persons and will reimburse such persons for out-of-pocket expenses incurred in forwarding such material.
INTERESTS OF CERTAIN PERSONS IN OR OPPOSITION
TO MATTERS ACTED UPON
No director, officer, nominee for election
as a director, associate of any director, officer of nominee or any other person has any substantial interest, direct or indirect,
by security holdings or otherwise, resulting from the matters described herein which is not shared by all other shareholders pro
rata in accordance with their respective interest.
FORWARD-LOOKING STATEMENTS
This information statement may contain certain
“forward-looking” statements (as that term is defined in the Private Securities Litigation Reform Act of 1995 or by
the U.S. Securities and Exchange Commission in its rules, regulations and releases) representing our expectations or beliefs regarding
our company. These forward-looking statements include, but are not limited to, statements concerning our operations, economic performance,
financial condition, and prospects and opportunities. For this purpose, any statements contained herein that are not statements
of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such
as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,”
“could,” “estimate,” “might,” or “continue” or the negative or other variations
thereof or comparable terminology are intended to identify forward-looking statements. These statements, by their nature, involve
substantial risks and uncertainties, certain of which are beyond our control, and actual results may differ materially depending
on a variety of important factors, including factors discussed in this and other of our filings with the U.S. Securities and Exchange
Commission.
23
ADDITIONAL INFORMATION
The Company is subject to the informational
requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and in accordance therewith files
reports, proxy statements and other information including annual and quarterly reports on Form 10-K and 10-Q (the “1934 Act
Filings”) with the Securities and Exchange Commission (the “Commission”). Reports and other information filed
by the Company can be inspected and copied at the public reference facilities maintained at the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D. C. 20549. Copies of such material can be obtained upon written request addressed to the Commission,
Public Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission maintains a web site
on the Internet (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers
that file electronically with the Commission through the Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”).
The following documents as filed with the Commission
by the Company are incorporated herein by reference:
1.
Annual Report on Form 10-K for the year ended August 31, 2014 and August 31, 2015.
2.
Periodic Reports on Form 10-Q for the quarter ended November 30, 2015, February 28, 2016, and May 31, 2016.
DELIVERY OF DOCUMENTS TO SECURITY HOLDERS
SHARING AN ADDRESS
If hard copies of
the materials are requested, we will send only one Information Statement and other corporate mailings to stockholders who share
a single address unless we received contrary instructions from any stockholder at that address. This practice, known as “householding,”
is designed to reduce our printing and postage costs. However, the Company will deliver promptly upon written or oral request a
separate copy of the Information Statement to a stockholder at a shared address to which a single copy of the Information Statement
was delivered. You may make such a written or oral request by (a) sending a written notification stating (i) your name, (ii) your
shared address and (iii) the address to which the Company should direct the additional copy of the Information Statement, to the
Company at Corporate Secretary,
8250 W. Charleston Blvd, Suite 110, Las Vegas, NV
89117, Telephone:
(702) 544-1902.
If multiple stockholders sharing an address
have received one copy of this Information Statement or any other corporate mailing and would prefer the Company to mail each stockholder
a separate copy of future mailings, you may send notification to or call the Company’s principal executive offices. Additionally,
if current stockholders with a shared address received multiple copies of this Information Statement or other corporate mailings
and would prefer the Company to mail one copy of future mailings to stockholders at the shared address, notification of such request
may also be made by mail or telephone to the Company’s principal executive offices.
CONCLUSION
As a matter of regulatory compliance, we are
sending you this Information Statement which describes the purpose and effect of the aforementioned corporate actions. Your consent
to the corporate actions are not required and is not being solicited in connection with this action. This Information Statement
is intended to provide our stockholders information required by the rules and regulations of the Securities Exchange Act of 1934.
24
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY. THE ATTACHED MATERIAL IS FOR INFORMATIONAL PURPOSES ONLY.
By Order of the Board of Directors
/s/ Barry Hall
Barry
Hall
Chief
Executive Officer
25
APPENDIX A
PLAN OF CONVERSION
FOR CONVERTING
JA ENERGY
a Nevada corporation
TO
UBI Blockchain Internet LTD.
a Delaware corporation
This Plan of Conversion
(together with all of the exhibits attached hereto, the “
Plan
”), dated ___________, 2016, is hereby adopted
by JA Energy, a Nevada corporation (the “
Company
”), in order to set forth the terms, conditions and procedures
governing the conversion of the Company from a Nevada corporation to a Delaware corporation pursuant to Section 265 of the General
Corporation Law of the State of Delaware, as amended (the “
DGCL
”), and Sections 92A.105 and 92A.120 of
the Nevada Revised Statutes, as amended (the “
NRS
”).
RECITALS
WHEREAS
, the Company is a corporation
organized and existing under the laws of the State of Nevada;
WHEREAS
, the Board of Directors of the
Company (the “
Board
”) has determined that it would be in the best interests of the Company and its stockholders
for the Company to convert from a Nevada corporation to a Delaware corporation pursuant to Section 265 of the DGCL and Sections
92A.105 and 92A.120 of the NRS; and
WHEREAS
, the form, terms and provisions
of this Plan have been authorized, approved and adopted by the Board and a majority of the Company’s stockholders by written
consent.
NOW, THEREFORE, BE IT RESOLVED
, that
the Company hereby adopts the Plan as follows:
1.
Conversion
.
a. Upon the Effective Date
(as hereinafter defined), the Company shall be converted from a Nevada corporation to a Delaware corporation pursuant to Section
265 of the DGCL and Sections 92A.105 and 92A.120 of the NRS (the “
Conversion
”) and the Company, as converted
to a Delaware corporation (the “
Resulting Company
”), shall thereafter be subject to all of the provisions
of the DGCL, except that notwithstanding Section 106 of the DGCL, the existence of the Resulting Company shall be deemed to have
commenced on the date the Company commenced its existence in the State of Nevada.
A-1
b. As promptly as practicable
following the adoption of the Plan, the Company shall cause the Conversion to be effective by:
i. filing articles of conversion
pursuant to Section 92A.205 of the NRS, substantially in the form attached hereto as
Exhibit B
(the “
Articles
of Conversion
”) with the Secretary of State of the State of Nevada;
ii. filing a certificate
of conversion, substantially in the form attached hereto as
Exhibit C
, pursuant to Sections 103 and 265 of the DGCL in (the
“
Certificate of Conversion
”) with the Secretary of State of the State of Delaware; and
iii. filing a Articles of
Incorporation of the Resulting Company substantially in the form attached hereto as
Exhibit D
(the “
Articles
of Incorporation
”) with the Secretary of State of the State of Delaware.
2.
Effect of Conversion
a. Upon the Effective Date,
the name of the Resulting Company will be “UBI Blockchain Internet LTD..”
b. Upon the Effective Date,
by virtue of the Conversion and without any further action on the part of the Company or its stockholders, the Resulting Company
shall, for all purposes of the laws of the State of Delaware, be deemed to be the same entity as the Company existing immediately
prior to the Effective Date. Upon the Effective Date, by virtue of the Conversion and without any further action on the part of
the Company or its stockholders, for all purposes of the laws of the State of Delaware, all of the rights, privileges and powers
of the Company existing immediately prior to the Effective Date, and all property, real, personal and mixed, and all debts due
to the Company existing immediately prior to the Effective Date, as well as all other things and causes of action belonging to
the Company existing immediately prior to the Effective Date, shall remain vested in the Resulting Company and shall be the property
of the Resulting Company and the title to any real property vested by deed or otherwise in the Company existing immediately prior
to the Effective Date shall not revert or be in any way impaired by reason of the Conversion; but all rights of creditors and all
liens upon any property of the Company existing immediately prior to the Effective Date shall be preserved unimpaired, and all
debts, liabilities and duties of the Company existing immediately prior to the Effective Date shall remain attached to the Resulting
Company upon the Effective Date, and may be enforced against the Resulting Company to the same extent as if said debts, liabilities
and duties had originally been incurred or contracted by the Resulting Company in its capacity as a corporation of the State of
Delaware. The rights, privileges, powers and interests in property of the Company existing immediately prior to the Effective Date,
as well as the debts, liabilities and duties of the Company existing immediately prior to the Effective Date, shall not be deemed,
as a consequence of the Conversion, to have been transferred to the Resulting Company upon the Effective Date for any purpose of
the laws of the State of Delaware.
A-2
c. The Conversion shall
not be deemed to affect any obligations or liabilities of the Company incurred prior to the Conversion or the personal liability
of any person incurred prior to the Conversion.
3.
Taxes.
The Company intends
for the Conversion to constitute a tax-free reorganization qualifying under Section 368(a) of the Internal Revenue Code of 1986,
as amended. Accordingly, neither the Company nor any of its stockholders should recognize gain or loss for federal income tax purposes
as a result of the Conversion.
4. Effective Date
. The Conversion shall become
effective upon the filing of the Articles of Conversion, the Certificate of Conversion and the Delaware Certificate of Incorporation
(the time of the effectiveness of the Conversion, the “
Effective Date
”).
5. Effect of Conversion on the Company’s Securities
. Upon
the Effective Date, by virtue of the Conversion and without any further action on the part of the Company or its stockholders:
a. Each share of common
stock of the Company, $0.001 par value per share (“
Company Common Stock
”) that is issued and outstanding
immediately prior to the Effective Date shall convert into one validly issued, fully paid and nonassessable share of common stock,
$0.001 par value per share, of the Resulting Company (“
Resulting Company Common Stock
”). Each
share of preferred stock of the Company, $0.001 par value per share (“
Company Preferred Stock
”) that
is issued and outstanding immediately prior to the Effective Date shall convert into one validly issued, fully paid and nonassessable
share of preferred stock of the Resulting Company, $0.001 par value per share (“
Resulting Company Preferred Stock
”).
b. All of the outstanding
certificates representing shares of Company Common Stock immediately prior to the Effective Date shall be deemed for all purposes
to continue to evidence ownership of and to represent the same number of shares of Resulting Company Common Stock.
6
.
Effect of Conversion on Directors
and Officers
. Upon the Effective Date, by virtue of the Conversion and without any further action on the part of the Company
or its stockholders, the members of the Board and the officers of the Company holding their respective offices in the Company existing
immediately prior to the Effective Time shall continue in their respective offices as members of the Board and officers of the
Resulting Company.
A-3
7. Further Assurances.
If, at any time
after the Effective Date, the Resulting Company shall determine or be advised that any deeds, bills of sale, assignments, agreements,
documents or assurances or any other acts or things are necessary, desirable or proper, consistent with the terms of the Plan,
(a) to vest, perfect or confirm, of record or otherwise, in the Resulting Company its right, title or interest in, to or under
any of the rights, privileges, immunities, powers, purposes, franchises, properties or assets of the Company existing immediately
prior to the Effective Date, or (b) to otherwise carry out the purposes of the Plan, the Resulting Company and its officers and
directors are hereby authorized to solicit in the name of the Resulting Company any third-party consents or other documents required
to be delivered by any third-party, to execute and deliver, in the name and on behalf of the Resulting Company all such deeds,
bills of sale, assignments, agreements, documents and assurances and do, in the name and on behalf of the Resulting Company, all
such other acts and things necessary, desirable or proper to vest, perfect or confirm its right, title or interest in, to or under
any of the rights, privileges, immunities, powers, purposes, franchises, properties or assets of the Company existing immediately
prior to the Effective Date and otherwise to carry out the purposes of the Plan.
8. Termination; Amendment.
At any time
prior to the Effective Date, the Plan may be terminated or amended by action of the Board if, in the opinion of the Board, such
action would be in the best interests of the Company and its stockholders.
10. Third Party Beneficiaries
. The Plan
shall not confer any rights or remedies upon any person other than as expressly provided herein.
11. Severability.
Whenever
possible, each provision of the Plan will be interpreted in such manner as to be effective and valid under applicable law, but
if any provision of the Plan is held to be prohibited by or invalid under applicable law, such provision will be ineffective only
to the extent of such prohibition or invalidity, without invalidating the remainder of the Plan.
IN WITNESS WHEREOF
, the Company has
caused this Plan to be duly executed as of the date first above written.
JA ENERGY
|
|
By:
|
/s/ Barry Hall
|
|
Barry Hall
Chief Executive Officer
|
A-4
ARTICLES OF CONVERSION
Appendix B to this Information Statement
[Seal of Nevada]
BARBARA K. CEGAVSKE
Secretary of State
202 North Carson Street
Carson City, Nevada 89701-4201
(775) 684-5708
Website: www.nvsos.gov
Articles of Conversion
(Pursuant to NRS 92A 205)
Page 1
USE BLACK INK ONLY - DO NOT HIGHLIGHT ABOVE SPACE IS FOR OFFICE
USE ONLY
PLEASE NOTE: The charter document for the resulting entity
must
be submitted/filed simultaneously with the articles of conversion.
Articles of Conversion
(Pursuant to NRS 92A.205)
|
1.
|
Name and jurisdiction of organization of constituent entity and resulting
entity:
|
JA Energy
Name of constituent entity
Nevada
Corporation
Jurisdiction Entity type *
and,
UBI Blockchain Internet LTD.
Name of resulting entity
Delaware
Corporation
Jurisdiction Entity type
|
2.
|
A plan of conversion has been adopted by the constituent entity in
compliance with the law of the jurisdiction governing the constituent entity.
|
|
3.
|
Location of plan of conversion: (check one)
|
[ ] The entire plan of conversion is attached
to these articles.
[X] The complete executed plan of conversion
is on file at the registered office or
principal place of business of the resulting
entity.
[ ] The complete executed plan of conversion for the resulting
domestic limited
partnership is
on file at the records office required by NRS 88.330. * corporation,
limited partnership, limited-liability limited
partnership, limited-liability company or
business trust .
This
form must be accompanied by appropriate fees.
Nevada Secretary
of State 92A Conversion Page 1
Revised 1-5-15
[Seal of Nevada]
BARBARA K. CEGAVSKE
Secretary of State
202 North Carson Street
Carson City, Nevada 89701-4201
(775) 684-5708
Website: www.nvsos.gov
Articles of Conversion
(Pursuant to NRS 92A 205)
Page 2
USE BLACK INK ONLY - DO NOT HIGHLIGHT ABOVE SPACE IS FOR
OFFICE USE ONLY
4. Forwarding address where copies of process may be sent by
the Secretary of State of Nevada
(if a foreign entity is the resulting entity in the conversion):
Attn: Chief Executive Officer
c/o: 8250 W. Charleston Blvd, Suite 110
Las Vegas, NV 89117
5.
Effective date and time of filing: (optional) (must not be later than 90 days after the certificate is filed)
Date: November 21, 2016
Time
11:59 pm
EDT
6. Signatures - must be signed by:
1. If constituent entity is a Nevada entity: an officer of each
Nevada corporation; all general partners of each Nevada limited partnership or limited-liability limited partnership; a manager
of each Nevada limited-liability company with managers or one member if there are no managers; a trustee of each Nevada business
trust; a managing partner of a Nevada limited-liability partnership (a.k.a. general partnership governed by NRS chapter 87).
2. If constituent entity is a foreign entity: must be signed by
the constituent entity in the manner provided by the law governing it.
Name of constituent entity
___
Barry Hall
_______________
Chief
Executive Officer
__
Nov. 2, 2016
_
Signature Title Date
* Pursuant to NRS 92A.205(4) if the conversion takes effect on
a later date specified in the articles of conversion pursuant to NRS 92A.240, the constituent document filed with the Secretary
of State pursuant to paragraph (b) subsection 1 must state the name and the jurisdiction of the constituent entity and that the
existence of the resulting entity does not begin until the later date.
This statement must be included within the resulting entity's
articles.
FILING FEE: $350.00
IMPORTANT:
Failure
to include any of the above information and submit with the proper fees may cause this filing to be rejected.
This
form must be accompanied by appropriate fees.
Nevada Secretary
of State 92A Conversion Page 2
Revised 1-5-15
CERTIFICATE OF CONVERSION
Appendix C to this Information Statement
CERTIFICATE OF CONVERSION
FROM A NON-DELAWARE CORPORATION
TO A DELAWARE CORPORATION
PURSUANT TO SECTION 265 OF THE
DELAWARE GENERAL CORPORATION LAW
1. The jurisdiction where the Non-Delaware Corporation first
formed is Nevada.
2. The jurisdiction immediately prior to filing this Certificate
of Conversion is Nevada.
3. The date the Non-Delaware Corporation first formed is: August
26, 2010.
4. The name of the Non-Delaware Corporation immediately prior
to filing this Certificate of Conversion is JA Energy
5. The name of the Corporation as set forth in the Certificate
of Incorporation is UBI Blockchain Internet LTD..
6. This Certificate of Conversion shall be effective at 11:59
pm EDT on November 21, 2016.
IN WITNESS WHEREOF
,
the undersigned being duly authorized to sign on behalf of the converting Non-Delaware Corporation have executed this Certificate
of Conversion on the 2nd day of October, 2016.
By:
|
/s/ Barry Hall
|
|
Barry Hall
Chief Executive Officer
|
CERTIFICATE OF INCORPORATION
Appendix D to this Information Statement
UBI
Blockchain Internet LTD.
ARTICLES OF INCORPORATION
ARTICLE I: NAME
The name of the corporation is: UBI Blockchain
Internet LTD.
ARTICLE II: AGENT FOR SERVICE OF PROCESS
The address of the corporation’s
registered office in the State of Delaware is:
16192 Coastal Highway, Lewes, Delaware 19958
.
The name of the registered agent of the corporation at that address is
Harvard Business Services,
Inc.
ARTICLE III: PURPOSE
The purpose of the
corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law
of the State of Delaware (“
General Corporation Law
”).
ARTICLE IV: AUTHORIZED STOCK
1.
Total Authorized
.
The total number
of shares of all classes of capital stock that the corporation has authority to issue is a total of 200,000,000 shares, consisting
of: 130,000,000 authorized shares of Class A Common Stock, $0.001 par value per share (“
Class A Common Stock
”),
6,000,000 authorized shares of Class B Common Stock, $0.001 par value per share (“
Class B Common Stock
”
and together with the Class A Common Stock, the “
Common Stock
”), 64,000,000 authorized shares of Class
C Capital Stock, $0.001 par value per share (“
Class C Capital Stock
” and together with the Common Stock,
the “
Capital Stock
”). The number of authorized shares of Class A Common Stock, Class B Common Stock or
Class C Capital Stock may be increased or decreased (but not below (i) the number of shares thereof then outstanding or (ii) with
the respect to the Class A Common Stock, the number of shares of Class A Common Stock reserved pursuant to Section 3.9 below) by
the affirmative vote of the holders of capital stock representing a majority of the voting power of all the then-outstanding shares
of capital stock of the corporation entitled to vote thereon, irrespective of the provisions of Section 242(b)(2) of the General
Corporation Law.
2.
Designation of Additional Shares
.
2.1 The Board of
Directors is authorized, subject to any limitations prescribed by the laws of the State of Delaware, by resolution or resolutions,
to provide for the issuance of the shares of Preferred Stock in one or more series, and, by filing a certificate of designation
pursuant to the applicable law of the State of Delaware (“
Certificate of Designation
”), to establish
from time-to-time the number of shares to be included in each such series, to fix the designation, powers (including voting powers),
preferences and relative, participating, optional or other rights, if any, of the shares of each such series and any qualifications,
limitations or restrictions thereof, and to increase (but not above the total number of authorized shares of such class) or decrease
(but not below the number of shares of such series then outstanding) the number of shares of any such series. The number of authorized
shares of Preferred Stock may also be increased or decreased (but not below the number of shares thereof then outstanding) by the
affirmative vote of the holders of a majority of the voting power of all the then-outstanding shares of capital stock of the corporation
entitled to vote thereon, without a separate vote of the holders of any series thereof, irrespective of the provisions of Section
242(b)(2) of the General Corporation Law, unless a vote of any such holders is required pursuant to the terms of any Certificate
of Designation designating a series of Preferred Stock.
2.2 Except as otherwise
expressly provided in any Certificate of Designation designating any series of Preferred Stock pursuant to the foregoing provisions
of this ARTICLE IV, any new series of Preferred Stock may be designated, fixed and determined as provided herein by the Board of
Directors without approval of the holders of Common Stock or the holders of Preferred Stock, or any series thereof, and any such
new series may have powers, preferences and rights, including, without limitation, voting powers, dividend rights, liquidation
rights, redemption rights and conversion rights, senior to, junior to or pari passu with the rights of the Common Stock, the Preferred
Stock, or any future class or series of Preferred Stock or Common Stock.
3.
Rights of Class A Common Stock,
Class B Common Stock and Class Capital Stock
.
3.1
Equal Status
.
Except as otherwise provided in this Certificate of Incorporation
(“
Certificate of Incorporation
”)
or required by applicable law, shares of Class A Common Stock, Class B Common Stock and Class C Capital Stock shall have the same
rights and powers, rank equally (including as to dividends and distributions, and upon any liquidation, dissolution or winding
up of the corporation), share ratably and be identical in all respects and as to all matters.
3.2
Voting Rights
.
Except as otherwise expressly provided by this Certificate of Incorporation or as provided by law, the holders of shares of Class
A Common Stock and Class B Common Stock shall (a) at all times vote together as a single class on all matters (including the election
of directors) submitted to a vote or for the consent (if action by written consent of the stockholders is permitted at such time
under this Certificate of Incorporation) of the stockholders of the corporation, (b) be entitled to notice of any stockholders’
meeting in accordance with the Bylaws of the corporation and (c) be entitled to vote upon such matters and in such manner as may
be provided by applicable law. Except as otherwise expressly provided herein or required by applicable law, each holder of Class
A Common Stock shall have the right to one (1) vote per share of Class A Common Stock held of record by such holder and each holder
of Class B Common Stock shall have the right to ten (10) votes per share of Class B Common Stock held of record by such holder.
Except with respect to the separate voting rights provided under the express circumstances described in this Section 3 or as provided
by law, the holders of shares of Class C Capital Stock shall (1) have no voting rights or power, (2) be entitled to notice of any
stockholders’ meeting in accordance with the Bylaws of the corporation and (3) not be entitled to vote on any matter that
is submitted to a vote or for the consent (if action by written consent of the stockholders is permitted at such time under this
Certificate of Incorporation) of the stockholders of the corporation. For the avoidance of doubt, the holders of shares of Class
C Capital Stock shall have no power to increase or decrease the number of shares of Class C Capital Stock authorized.
3.3
Dividend
and Distribution Rights
. Shares of Class A Common Stock
, Class B Common Stock
and Class
C Capital
Stock shall
be treated equally, identically and ratably, on a per share basis, with respect to any dividends or distributions as may be declared
and paid from time to time by the Board of Directors out of any assets of the corporation legally available therefor;
provided
,
however
, that in the event a dividend is paid in the form of shares of Class A Common Stock
or
, Class B
Common Stock or Class C Capital Stock (or rights to acquire, or securities convertible into or exchangeable for, such shares),
then holders of Class A Common Stock shall receive shares of Class A Common Stock (or rights to acquire, or securities convertible
into or exchangeable for, such shares, as the case may be), holders of Class B Common Stock shall receive shares of Class B Common
Stock (or rights to acquire, or securities convertible into or exchangeable for, such shares, as the case may be) and, subsequent
to the Initial Class C Dividend, holders of Class C Capital Stock shall receive shares of Class C Capital Stock (or rights to acquire,
or securities convertible into or exchangeable for, such shares, as the case may be), with holders of shares of Class A Common
Stock, Class B Common Stock and Class Capital Stock receiving, on a per share basis, an identical number of shares of Class A Common
Stock
or
, Class B Common Stock or Class C Capital Stock, as applicable. Notwithstanding the foregoing, the Board
of Directors may pay or make a disparate dividend or distribution per share of Class A Common Stock, Class B Common Stock or Class
Capital Stock (whether in the amount of such dividend or distribution payable per share, the form in which such dividend or distribution
is payable, the timing of the payment, or otherwise) if such disparate dividend or distribution is approved in advance by the affirmative
vote (or written consent if action by written consent of stockholders is permitted at such time under this Certificate of Incorporation)
of the holders of a majority of the outstanding shares of Class A Common Stock, Class B Common Stock and Class C Capital Stock,
each voting separately as a class.
3.4
Subdivisions,
Combinations or Reclassifications
. Shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock may not be
subdivided, combined or reclassified unless the shares of each of the other classes are concurrently therewith proportionately
subdivided, combined or reclassified in a manner that maintains the same proportionate equity ownership between the holders of
the outstanding Class A Common Stock, Class B Common Stock and Class C Capital Stock on the record date for such subdivision, combination
or reclassification;
provided
,
however
, that shares of one such class may be subdivided, combined or reclassified
in a different or disproportionate manner if such subdivision, combination or reclassification is approved in advance by the affirmative
vote (or written consent if action by written consent of stockholders is permitted at such time under this Certificate of Incorporation)
of the holders of a majority of the outstanding shares of Class A Common Stock, Class B Common Stock and Class C Capital Stock,
each voting separately as a class.
3.5
Liquidation,
Dissolution or Winding Up
. Subject to the preferential or other rights of any holders of Preferred Stock then outstanding,
upon the dissolution, liquidation or winding up of the corporation, whether voluntary or involuntary, holders of Class A Common
Stock and Class B Common Stock will be entitled to receive ratably all assets of the corporation available for distribution to
its stockholders unless disparate or different treatment of the shares of each such class with respect to distributions upon any
such liquidation, dissolution or winding up is approved in advance by the affirmative vote (or written consent if action by written
consent of stockholders is permitted at such time under this Certificate of Incorporation) of the holders of a majority of the
outstanding shares of Class A Common Stock and Class B Common Stock, each voting separately as a class.
3.6
Transactions.
(a) Merger or
Consolidation
. In the case of any distribution or payment in respect of the shares of Class A Common Stock
or
,
Class B Common Stock
or Class C Capital Stock
upon the consolidation or merger of the corporation with or into any other
entity, or in the case of any other transaction having an effect on stockholders substantially similar to that resulting from a
consolidation or merger, such as a sale of substantially all of the Corporation’s assets, such distribution or payment shall
be made ratably on a per share basis among the holders of the Class A Common Stock, Class B Common Stock and Class C Capital Stock
as a single class;
provided, however,
that shares of one or two of such classes may receive or have the right to elect to
receive different or disproportionate consideration in connection with such consolidation, merger or other transaction if the only
difference in the per share consideration to the holders of the Class A Common Stock, Class B Common Stock and Class C Capital
Stock is that any securities distributed to the holder of a share of Class B Common Stock have ten (10) times the voting power
of any securities distributed to the holder of a share of Class A Common Stock and that any securities distributed to the holder
of a share of Class C Capital Stock have no voting rights or power.
(b) Third-Party
Tender or Exchange Offers.
The corporation may not enter into any agreement pursuant to which a third party may by tender or
exchange offer acquire any shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock, nor may the corporation
recommend that holders tender shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock into any third party
tender or exchange offer, unless the holders of (i) the Class A Common Stock shall have the right to receive, or the right to elect
to receive, the same form of consideration and the same amount of consideration on a per share basis as the holders of the Class
B Common Stock and Class C Capital Stock would receive, or have the right to elect to receive, as applicable, (ii) the Class B
Common Stock shall have the right to receive, or the right to elect to receive, the same form of consideration and the same amount
of consideration on a per share basis as the holders of the Class A Common Stock and Class C Capital Stock would receive, or have
the right to elect to receive, as applicable, and (iii) the Class C Capital Stock shall have the right to receive, or the right
to elect to receive, the same form of consideration and the same amount of consideration on a per share basis as the holders of
the Class A Common Stock and Class B Common Stock would receive, or have the right to elect to receive, as applicable;
provided
,
however
, that shares of one such class may receive or have the right to elect to receive different or disproportionate consideration
in connection with such tender or exchange offer if the only difference in the per share consideration to the holders of the Class
A Common Stock, Class B Common Stock and Class C Capital Stock is that any securities distributed to the holder of a share of Class
B Common Stock have ten (10) times the voting power of any securities distributed to the holder of a share of Class A Common Stock
,
and that any securities distributed to the holder of a share of Class C Capital Stock have no voting rights or power.
3.7
Change of
Control Class B Vote
. Until the first date on which the outstanding shares of Class B Common Stock represent less than thirty-five
percent (35%) of the total voting power of the then outstanding shares of the corporation then entitled to vote generally in the
election of directors, the corporation shall not consummate a Change in Control Transaction (as defined in Section 4 of this ARTICLE
IV) without first obtaining the affirmative vote (or written consent if action by written consent of stockholders is permitted
at such time under this Certificate of Incorporation) of the holders of a majority of the then outstanding shares of Class B Common
Stock, voting as a separate class, in addition to any other vote required by applicable law, this Certificate of Incorporation
or the Bylaws.
3.8
Conversion
.
(a)
Voluntary
Conversion
. Each share of Class B Common Stock shall be convertible into one (1) fully paid and nonassessable share of Class
A Common Stock at the option of the holder thereof at any time upon written notice to the corporation. Before any holder of Class
B Common Stock shall be entitled to voluntarily convert any shares of such Class B Common Stock, such holder shall surrender the
certificate or certificates therefor (if any), duly endorsed, at the principal corporate office of the corporation or of any transfer
agent for the Class B Common Stock, and shall give written notice to the corporation at its principal corporate office, of the
election to convert the same and shall state therein the name or names (i) in which the certificate or certificates representing
the shares of Class A Common Stock into which the shares of Class B Common Stock are so converted are to be issued if such shares
are certificated or (ii) in which such shares are to be registered in book entry if such shares are uncertificated. The corporation
shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Class B Common Stock, or to the nominee
or nominees of such holder, a certificate or certificates representing the number of shares of Class A Common Stock to which such
holder shall be entitled as aforesaid (if such shares are certificated) or, if such shares are uncertificated, register such shares
in book-entry form. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of
such surrender of the shares of Class B Common Stock to be converted following or contemporaneously with the written notice of
such holder’s election to convert required by this Section 3.8(a), and the person or persons entitled to receive the shares
of Class A Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such
shares of Class A Common Stock as of such date. Each share of Class B Common Stock that is converted pursuant to this Section 3.8(a)
shall be retired by the corporation and shall not be available for reissuance.
(b)
Automatic
Conversion of Class B Common Stock
. (i) Each share of Class B Common Stock shall be automatically, without further action by
the holder thereof, converted into one (1) fully paid and nonassessable share of Class A Common Stock, upon the occurrence of a
Transfer (as defined in Section 4 of this ARTICLE IV), other than a Permitted Transfer (as defined in Section 4 of this ARTICLE
IV), of such share of Class B Common Stock; (ii) all shares of Class B Common Stock shall be automatically, without further action
by any holder thereof, converted into an identical number of fully paid and nonassessable shares of Class A Common Stock at such
date and time, or the occurrence of an event, specified by the affirmative vote (or written consent if action by written consent
of stockholders is permitted at such time under this Certificate of Incorporation) of the holders of a majority of the then outstanding
shares Class B Common Stock, voting as a separate class.
(c) Certificates.
Each outstanding stock certificate (if shares are in certificated form) that, immediately prior to a Conversion Event, represented
one or more shares of Class B Common Stock subject to such Conversion Event shall, upon such Conversion Event, be deemed to represent
an equal number of shares of Class A Common Stock, without the need for surrender or exchange thereof. The corporation shall, upon
the request of any holder whose shares of Class B Common Stock have been converted into shares of Class A Common Stock as a result
of a Conversion Event and upon surrender by such holder to the corporation of the outstanding certificate(s) formerly representing
such holder’s shares of Class B Common Stock (if any), issue and deliver to such holder certificate(s) representing the shares
of Class A Common Stock into which such holder’s shares of Class B Common Stock Stock were converted as a result of such
Conversion Event (if such shares are certificated) or, if such shares are uncertificated, register such shares in book-entry form.
Each share of Class B Common Stock that is converted pursuant to Section 3 of ARTICLE IV shall thereupon be retired by the corporation
and shall not be available for reissuance.
(d
) Policies
and Procedures.
The corporation may, from time to time, establish such policies and procedures, not in violation of applicable
law or the other provisions of this Certificate
of Incorporation
, relating to the conversion of the Class B Common Stock
into Class A Common Stock, as it may deem necessary or advisable in connection therewith. If the corporation has reason to believe
that a Transfer giving rise to a conversion of shares of Class B Common Stock into Class A Common Stock has occurred but has not
theretofore been reflected on the books of the corporation, the corporation may request that the holder of such shares furnish
affidavits or other evidence to the corporation as the corporation deems necessary to determine whether a conversion of shares
of Class B Common Stock to Class A Common Stock has occurred, and if such holder does not within ten (10) days after the date of
such request furnish sufficient evidence to the corporation (in the manner provided in the request) to enable the corporation to
determine that no such conversion has occurred, any such shares of Class B Common Stock, to the extent not previously converted,
shall be automatically converted into shares of Class A Common Stock and the same shall thereupon be registered on the books and
records of the corporation. In connection with any action of stockholders taken at a meeting or by written consent (if action by
written consent of stockholders is permitted at such time under this Certificate of Incorporation), the stock ledger of the corporation
shall be presumptive evidence as to who are the stockholders entitled to vote in person or by proxy at any meeting of stockholders
or in connection with any such written consent and the class or classes or series of shares held by each such stockholder and the
number of shares of each class or classes or series held by such stockholder.
3.9
Reservation
of Stock
. The corporation shall at all times reserve and keep available out of its authorized but unissued shares of Class
A Common Stock, solely for the purpose of effecting the conversion of the shares of Class B Common Stock
and Class C Capital
Stock
, such number of shares of Class A Common Stock as shall from time to time be sufficient to effect the conversion of all
outstanding shares of Class B Common
Stock and Class C Capital
Stock into shares of Class A Common Stock.
3.10
Protective
Provision
. The corporation shall not, whether by merger, consolidation or otherwise, amend, alter, repeal or waive Sections
3 or 4 of this Article IV (or adopt any provision inconsistent therewith), without first obtaining the affirmative vote (or written
consent if action by written consent of stockholders is permitted at such time under this Certificate of Incorporation) of the
holders of a majority of the then outstanding shares of Class A Common Stock, Class B Common Stock, and Class C Capital Stock,
each voting as a separate class, in addition to any other vote required by applicable law, this Certificate of Incorporation or
the Bylaws;
provided
,
however
; the date provided for in clause (iii) of Section 3.8(b) for an Automatic Conversion
Event can be changed to an earlier date with the consent of a majority of the Directors.
4.
Definitions
.
For purposes
of this Certificate of Incorporation:
4.1
“Approved
Executive Officer”
means (i) the Chief Executive Officer of the corporation, (ii) the Executive Chairman of the Board
of Directors, (iii) any other position that would constitute an “executive officer” of the corporation under Rule 3b-7
of the Securities Exchange Act of 1934, as amended, or (iv) with the approval of the majority of the Directors, any other position
or role with the corporation designated as an “Approved Executive Officer.”
4.2 “Cause”
shall mean the occurrence of any of the following: (i) an Officers’ willful and continued failure substantially to perform
his duties and responsibilities to the corporation (other than a failure resulting from incapacity due to physical or mental illness)
that is materially and demonstrably injurious to the corporation; (ii) an Officers’ deliberate violation of a policy of the
corporation applicable to the Officer that is materially and demonstrably injurious to the corporation; (iii) the Officers' commission
of any act of fraud, embezzlement, willful dishonesty or any other willful misconduct with respect to the Officers' duties as an
Approved Executive Officer that has caused a material and demonstrable injury to the corporation; (iv) the Officers' deliberate
unauthorized use or disclosure of any proprietary information or trade secrets of the corporation or any other party to whom the
Officer owes an obligation of nondisclosure as a result of his duties as an Approved Executive Officer that is materially and demonstrably
injurious to the corporation; or (v) the Officers' willful breach of any written agreement or covenant with the corporation that
is materially and demonstrably injurious to the corporation; provided, that (A) in each case, for purposes of determining whether
conduct constitutes willful or deliberate conduct, no act or failure to act on the Officers' part shall be considered “willful”
or “deliberate” unless it is done by the Officer in bad faith and without reasonable belief that the Officers' action
or inaction was in the best interests of the corporation; (B) any act, or failure to act, based on authority given pursuant to
a resolution duly adopted by the corporation’s Board of Directors
or based on the written advice of counsel
for the corporation will be conclusively presumed to be done, or omitted to be done, by the Officer in good faith and in the best
interests of the corporation; and (C) the Officers' leave or resignation in accordance with Sections 4.18(a) or 4.18(b) hereof
shall not be deemed an occurrence giving rise to Cause. Notwithstanding the foregoing, the Officer shall not be deemed terminated
for Cause as an Approved Executive Officer for purposes of Section 3.8(b) of this ARTICLE IV unless and until (x) a written notice
of intent to terminate the Officer for “Cause,” specifying the particulars of the conduct of the Officer forming the
basis for such, is given to the Officer based on the approval of at least 75% of the Directors within sixty (60) days of the initial
awareness of such conduct by the Chief Financial Officer, Chief Operating Officer or General Counsel of the corporation or by any
member of the Board of Directors and (y) subsequently at least 75% of the Directors find at an in-person meeting, after reasonable
notice to the Officer (which notice shall be delivered in writing at least sixty (60) days prior to such meeting and indicate that
the corporation’s Board of Directors will consider a termination of the Officers' as an Approved Executive Officer at such
meeting), and an opportunity for the Officer and his counsel to be heard in person by the Board of Directors, that (1) termination
of the Officer for “Cause” is justified and (2) the Officer has not cured the conduct giving rise to such termination
for “Cause” (for purposes of this Section 4.2, a meeting shall be deemed to have been held “in-person”
if a majority of the members of the Board of Directors (including at least 75% of the Directors), other than the Officer, attend
the meeting in person). The Officer shall have sixty (60) days (or such longer period specified in the notice of intent to terminate
for “Cause”) from receipt of a notice of intent to terminate for “Cause” to cure the conditions set forth
in such notice, if such conditions are subject to cure. Any purported termination as an Approved Executive Officer for “Cause”
must meet the requirements of this Section 4.2. Any purported termination as an Approved Executive Officer that does not comply
with the foregoing, including any termination prior to the expiration of the sixty (60) day cure period, shall be deemed to be
a termination without “Cause”.
4.3
“
Change
in Control Transaction
” means the occurrence of any of the following events:
(a) the sale, lease,
exchange, encumbrance or other disposition (other than licenses that do not constitute an effective disposition of all or substantially
all of the assets of the corporation and its subsidiaries taken as a whole, and the grant of security interests in the ordinary
course of business) by the corporation of all or substantially all of the corporation’s assets; or
(b) the merger or
consolidation of the corporation with or into any other entity, other than a merger or consolidation that would result in the Class
B Common Stock of the corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding
or by being converted into voting securities of the surviving entity or its sole parent entity) more than fifty percent (50%) of
the total voting power represented by the voting securities of the corporation or such surviving entity or its sole parent entity
outstanding immediately after such merger or consolidation.
4.4
“
Permitted
Transfer
” shall mean, and be restricted to, any Transfer of a share of Class B Common Stock:
(a) by a Qualified
Stockholder (or the estate of a deceased Qualified Stockholder) to (i) one or more Family Members of such Qualified Stockholder,
or (ii) any Permitted Entity of such Qualified Stockholder; or (iii) to such Qualified Stockholder’s revocable living trust,
which revocable living trust is itself both a Permitted Trust and a Qualified Stockholder;
(b) by a Permitted
Entity of a Qualified Stockholder to (i) such Qualified Stockholder or one or more Family Members of such Qualified Stockholder,
or (ii) any other Permitted Entity of such Qualified Stockholder; or
4.5
“
Permitted
Transferee
” shall mean a transferee of shares of Class B Common Stock received in a Transfer that constitutes a Permitted
Transfer.
4.6 “Qualified
Stockholder”
shall mean (a) the registered holder of a share of Class B Common Stock as of the Covered Security Date;
(b) the initial registered holder of any shares of Class B Common Stock that are originally issued by the corporation after the
Covered Security Date pursuant to the exercise or conversion of options or warrants or settlement of restricted stock units (RSUs)
that, in each case, are outstanding as of the Covered Security Date; (c) each natural person who Transferred shares of or equity
awards for Class B Common Stock (including any option or warrant exercisable or convertible into or any RSU that can be settled
in shares of Class B Common Stock) to a Permitted Entity that is or becomes a Qualified Stockholder.
4.7 “
Transfer
”
of a share of Class B Common Stock shall mean, directly or indirectly, any sale, assignment, transfer, conveyance, hypothecation
or other transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and
whether voluntary or involuntary or by operation of law (including by merger, consolidation or otherwise), including, without limitation,
a transfer of a share of Class B Common Stock to a broker or other nominee (regardless of whether there is a corresponding change
in beneficial ownership), or the transfer of, or entering into a binding agreement with respect to, Voting Control (as defined
below) over such share by proxy or otherwise. A “Transfer” shall also be deemed to have occurred with respect to a
share of Class B Common Stock beneficially held by (i) an entity that is a Permitted Entity, if there occurs any act or circumstance
that causes such entity to no longer be a Permitted Entity or (ii) an entity that is a Qualified Stockholder, if there occurs a
Transfer on a cumulative basis, from and after the Covered Security Date, of a majority of the voting power of the voting securities
of such entity or any direct or indirect Parent of such entity, other than a Transfer to parties that are, as of the Covered Security
Date, holders of voting securities of any such entity or Parent of such entity. Notwithstanding the foregoing, the following shall
not be considered a “Transfer” within the meaning of this ARTICLE IV:
(a) the granting
of a revocable proxy to officers or directors of the corporation at the request of the Board of Directors in connection with actions
to be taken at an annual or special meeting of stockholders or in connection with any action by written consent of the stockholders
solicited by the Board of Directors (if action by written consent of stockholders is permitted at such time under this Certificate
of Incorporation);
(b) entering into
a voting trust, agreement or arrangement (with or without granting a proxy) solely with stockholders who are holders of Class B
Common Stock, which voting trust, agreement or arrangement (i) is disclosed either in a Schedule 13D filed with the Securities
and Exchange Commission or in writing to the Secretary of the corporation, (ii) either has a term not exceeding one (1) year or
is terminable by the holder of the shares subject thereto at any time and (iii) does not involve any payment of cash, securities,
property or other consideration to the holder of the shares subject thereto other than the mutual promise to vote shares in a designated
manner;
(c) the pledge of
shares of Class B Common Stock by a stockholder that creates a mere security interest in such shares pursuant to a bona fide loan
or indebtedness transaction for so long as such stockholder continues to exercise Voting Control over such pledged shares;
provided
,
however
, that a foreclosure on such shares or other similar action by the pledgee shall constitute a “Transfer”
unless such foreclosure or similar action qualifies as a “Permitted Transfer” at such time;
or
4.8
“
Voting
Threshold Date
” shall mean 5:00 p.m. (Eastern Time) on the first day falling on or after the date on which the outstanding
shares of Class B Common Stock represent less than a majority of the total voting power of the then outstanding shares of the corporation
then entitled to vote generally in the election of directors.
ARTICLE V: AMENDMENT OF BYLAWS
The Board of Directors
of the corporation shall have the power to adopt, amend or repeal the Bylaws of the corporation. Any adoption, amendment or repeal
of the Bylaws of the corporation by the Board of Directors shall require the approval of a majority of the Whole Board. For purposes
of this Certificate of Incorporation, the term “
Whole Board
” shall mean the total number of authorized
directors whether or not there exist any vacancies in previously authorized directorships. The stockholders shall also have power
to adopt, amend or repeal the Bylaws of the corporation. Prior to the Voting Threshold Date, in addition to any vote of the holders
of any class or series of stock of the corporation required by applicable law or by this Certificate of Incorporation (including
any Preferred Stock issued pursuant to a Certificate of Designation), such adoption, amendment or repeal of the Bylaws of the corporation
by the stockholders shall require the affirmative vote of a majority in voting power of all of the then outstanding shares of capital
stock of the corporation entitled to vote generally in the election of directors, voting together as a single class. From and after
the Voting Threshold Date, in addition to any vote of the holders of any class or series of stock of the corporation required by
applicable law or by this Certificate of Incorporation (including any Preferred Stock issued pursuant to a Certificate of Designation),
such adoption, amendment or repeal of the Bylaws of the corporation by the stockholders shall require the affirmative vote of the
holders of at least two-thirds of the voting power of all of the then-outstanding shares of the capital stock of the corporation
entitled to vote generally in the election of directors, voting together as a single class.
ARTICLE VI: MATTERS RELATING TO THE
BOARD OF DIRECTORS
1.
Director
Powers
. The business and affairs of the corporation shall be managed by or under the direction of the Board of Directors.
In addition to the powers and authority expressly conferred upon them by statute or by this Certificate of Incorporation or the
Bylaws of the corporation, the directors are hereby empowered to exercise all such powers and do all such acts and things as may
be exercised or done by the corporation.
2.
Number
of Directors
. Subject to the rights of the holders of any series of Common Stock to elect additional directors under specified
circumstances, the number of directors shall be fixed from time to time exclusively by resolution adopted by a majority of the
Whole Board.
3.
Term and
Removal
. Each director shall hold office until such director’s successor is elected and qualified, or until such
director’s earlier death, resignation or removal. Any director may resign at any time upon notice to the corporation given
in writing or by any electronic transmission permitted in the corporation’s Bylaws or in accordance with applicable law.
Subject to the rights of the holders of any series of Preferred Stock with respect to directors elected thereby, from and after
the effectiveness of the Classified Board, no director may be removed except for cause and only by the affirmative vote of the
holders of at least a majority of the voting power of the then-outstanding shares of capital stock of the corporation then entitled
to vote at an election of directors voting together as a single class. No decrease in the number of directors constituting the
Whole Board shall shorten the term of any incumbent director.
4.
Board Vacancies
.
All vacancies in the Board of Directors, whether caused by resignation, death of otherwise, may be filled by a majority vote of
the remaining director or directors, even though they constitute less than a quorum, or by a majority vote of the stockholders.
This may be accomplished at any special or regular meeting of the Board of Directors or by the stockholders at any regular or special
meeting. A director thus elected to fill any vacancies shall hold office for the unexpired term of their predecessor and until
their successor is elected and qualified.
5.
Vote by
Ballot
. Election of directors need not be by written ballot.
6. Actions
by Directors
.
Unless the Board otherwise provides, when the Directors are required to consent, approve, make findings
or determinations or take any of the other actions specified in Sections 3 and 4 of ARTICLE IV (“
Director Actions
”),
such Director Actions shall be conducted in the same manner as the Board conducts its business pursuant to the Bylaws of the Corporation.
ARTICLE VII: DIRECTOR LIABILITY; INDEMNIFICATION
1.
Limitation
of Liability
. To the fullest extent permitted by law, no director of the corporation shall be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. Without limiting the effect of
the preceding sentence, if the General Corporation Law is hereafter amended to authorize the further elimination or limitation
of the liability of a director, then the liability of a director of the corporation shall be eliminated or limited to the fullest
extent permitted by the General Corporation Law, as so amended.
2.
Indemnification
.
The corporation shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to an action
or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that he, his testator or intestate
is or was a director or officer of the corporation or any predecessor of the
corporation
, or serves or served at any other
enterprise as a director or officer at the request of the corporation or any predecessor to the corporation.
3.
Change
in Rights
. Neither any amendment nor repeal of this ARTICLE VII, nor the adoption of any provision of this Certificate
of Incorporation inconsistent with this ARTICLE VII, shall eliminate or reduce the effect of this
ARTICLE
VII in respect
of any matter occurring, or any action or proceeding accruing or arising or that, but for this
ARTICLE
VII, would accrue
or arise, prior to such amendment, repeal or adoption of an inconsistent provision.
ARTICLE VIII: MATTERS RELATING TO STOCKHOLDERS
1.
Informal
Action By Stockholders
. Unless otherwise provided in the Delaware Corporate Law, any action that may be taken at any annual
or special meeting of shareholders may be taken without a meeting and without prior notice if a consent in writing, setting forth
the action so taken, is signed by the holders of outstanding shares having not less than two-thirds (66.6%) percent of votes that
would be necessary to authorize or take such action at a meeting at which all shares entitled to vote on such action were present
and voted. Unless the consents of all shareholders entitled to vote have been solicited in writing, and unless the majority written
consent of all shareholders has been received, the Secretary shall give prompt notice of the corporate action approved by the shareholders
without a meeting.
2.
Special
Meeting of Stockholders
.
Subject to the rights of the Shareholders of with respect to actions by the Shareholders,
special meetings of the stockholders of the corporation may be called only by the Board of Directors acting pursuant to a resolution
adopted by a majority of the Whole Board, the Chief Executive Officer, or the President or the Chairperson of the Board, and may
not be called by any other person or persons. Business transacted at special meetings of stockholders shall be confined to the
purpose or purposes stated in the notice of meeting.
3.
Advance
Notice of Stockholder Nominations
. Advance notice of stockholder nominations for the election of directors of the corporation
and of business to be brought by stockholders before any meeting of stockholders of the corporation shall be given in the manner
provided in the Bylaws of the corporation.
4.
Business
Combinations
. The corporation elects not to be governed by Section 203 of the General Corporation Law.
ARTICLE IX: CHOICE OF FORUM
Unless the corporation
consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest
extent permitted by law, be the sole and exclusive forum for (1) any derivative action or proceeding brought on behalf of the corporation,
(2) any action asserting a claim of breach of a fiduciary duty owed by, or other wrongdoing by, any director, officer, employee
,
agent
or stockholder
of the corporation to the corporation or the corporation’s stockholders, (3) any action asserting
a claim arising pursuant to any provision of the General Corporation Law or the corporation’s Certificate of Incorporation
or Bylaws, (4) any action to interpret, apply, enforce or determine the validity of the corporation’s Certificate of Incorporation
or Bylaws or (5) any action asserting a claim governed by the internal affairs doctrine, in each such case subject to said Court
of Chancery having personal jurisdiction over the indispensable parties named as defendants therein. Any person or entity purchasing
or otherwise acquiring any interest in shares of capital stock of the corporation shall be deemed to have notice of and consented
to the provisions of this ARTICLE IX.
ARTICLE X: AMENDMENT OF CERTIFICATE
OF INCORPORATION
The corporation
reserves the right to amend or repeal any provision contained in this Certificate of Incorporation in the manner prescribed by
the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation;
provided,
however
, that, notwithstanding any other provision of this Certificate of Incorporation or any provision of applicable law
that might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the
capital stock of this corporation required by applicable law or by this Certificate of Incorporation, from and after the Voting
Threshold Date, any amendment to or repeal of this ARTICLE X or ARTICLE V, ARTICLE VI, ARTICLE VII, ARTICLE VIII or ARTICLE IX
of this Certificate of Incorporation (or the adoption of any provision inconsistent therewith) shall require the affirmative vote
of the holders of at least two-thirds of the voting power of the then outstanding shares of capital stock of the corporation entitled
to vote generally in the election of directors, voting together as a single class.
* * * * * * * * * * *
Appendix E to this Information Statement
NEVADA REVISED STATUTES
SECTIONS 92A.300-92A.500
RIGHTS OF DISSENTING OWNERS
NRS 92A.300 Definitions.
As
used in NRS 92A.300 to 92A.500, inclusive, unless the context otherwise requires, the words and terms defined in NRS 92A.305 to
92A.335, inclusive, have the meanings ascribed to them in those sections.
(Added
to NRS by 1995, 2086)
NRS 92A.305 “Beneficial stockholder”
defined.
“Beneficial stockholder” means a person who is a beneficial owner of shares held in a voting trust
or by a nominee as the stockholder of record.
(Added to NRS by 1995, 2087)
NRS 92A.310 “Corporate action”
defined.
“Corporate action” means the action of a domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.315 “Dissenter”
defined.
“Dissenter” means a stockholder who is entitled to dissent from a domestic corporation’s action
under NRS 92A.380 and who exercises that right when and in the manner required by NRS 92A.400 to 92A.480, inclusive.
(Added to NRS by 1995, 2087; A 1999, 1631)
NRS 92A.320 “Fair value”
defined.
“Fair value,” with respect to a dissenter’s shares, means the value of the shares determined:
1. Immediately before the effectuation
of the corporate action to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the corporate
action unless exclusion would be inequitable;
2. Using customary and current valuation
concepts and techniques generally employed for similar businesses in the context of the transaction requiring appraisal; and
3. Without discounting for lack of marketability
or minority status.
(Added to NRS by 1995, 2087; A 2009, 1720)
NRS 92A.325 “Stockholder”
defined.
“Stockholder” means a stockholder of record or a beneficial stockholder of a domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.330 “Stockholder of record”
defined.
“Stockholder of record” means the person in whose name shares are registered in the records of a
domestic corporation or the beneficial owner of shares to the extent of the rights granted by a nominee’s certificate on
file with the domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.335 “Subject corporation”
defined.
“Subject corporation” means the domestic corporation which is the issuer of the shares held by a
dissenter before the corporate action creating the dissenter’s rights becomes effective or the surviving or acquiring entity
of that issuer after the corporate action becomes effective.
(Added to NRS by 1995, 2087)
NRS
92A.340 Computation of interest.
Interest payable pursuant to NRS 92A.300 to 92A.500, inclusive, must be computed
from the effective date of the action until the date of payment, at the rate of interest most recently established pursuant to
NRS 99.040.
(Added to NRS by 1995, 2087; A 2009, 1721)
NRS 92A.350 Rights of dissenting partner
of domestic limited partnership. A
partnership agreement of a domestic limited partnership or, unless otherwise provided in
the partnership agreement, an agreement of merger or exchange, may provide that contractual rights with respect to the partnership
interest of a dissenting general or limited partner of a domestic limited partnership are available for any class or group of partnership
interests in connection with any merger or exchange in which the domestic limited partnership is a constituent entity.
(Added to NRS by 1995, 2088)
NRS 92A.360 Rights of dissenting member
of domestic limited-liability company.
The articles of organization or operating agreement of a domestic limited-liability
company or, unless otherwise provided in the articles of organization or operating agreement, an agreement of merger or exchange,
may provide that contractual rights with respect to the interest of a dissenting member are available in connection with any merger
or exchange in which the domestic limited-liability company is a constituent entity.
(Added to NRS by 1995, 2088)
NRS 92A.370 Rights of dissenting member
of domestic nonprofit corporation.
1. Except as otherwise provided in subsection
2, and unless otherwise provided in the articles or bylaws, any member of any constituent domestic nonprofit corporation who voted
against the merger may, without prior notice, but within 30 days after the effective date of the merger, resign from membership
and is thereby excused from all contractual obligations to the constituent or surviving corporations which did not occur before
the member’s resignation and is thereby entitled to those rights, if any, which would have existed if there had been no merger
and the membership had been terminated or the member had been expelled.
2. Unless otherwise provided in its articles
of incorporation or bylaws, no member of a domestic nonprofit corporation, including, but not limited to, a cooperative corporation,
which supplies services described in chapter 704 of NRS to its members only, and no person who is a member of a domestic nonprofit
corporation as a condition of or by reason of the ownership of an interest in real property, may resign and dissent pursuant to
subsection 1.
(Added to NRS by 1995, 2088)
NRS 92A.380 Right of stockholder to
dissent from certain corporate actions and to obtain payment for shares.
1. Except as otherwise provided in NRS
92A.370 and 92A.390, any stockholder is entitled to dissent from, and obtain payment of the fair value of the stockholder’s
shares in the event of any of the following corporate actions:
(a) Consummation of a plan of merger to which
the domestic corporation is a constituent entity:
(1) If approval by the stockholders is required
for the merger by NRS 92A.120 to 92A.160, inclusive, or the articles of incorporation, regardless of whether the stockholder is
entitled to vote on the plan of merger; or
(2) If the domestic corporation is a subsidiary
and is merged with its parent pursuant to NRS 92A.180.
(b) Consummation of a plan of conversion to
which the domestic corporation is a constituent entity as the corporation whose subject owner’s interests will be converted.
(c) Consummation of a plan of exchange to which
the domestic corporation is a constituent entity as the corporation whose subject owner’s interests will be acquired, if
the stockholder’s shares are to be acquired in the plan of exchange.
(d) Any corporate action taken pursuant to a
vote of the stockholders to the extent that the articles of incorporation, bylaws or a resolution of the board of directors provides
that voting or nonvoting stockholders are entitled to dissent and obtain payment for their shares.
(e) Accordance of full voting rights to control
shares, as defined in NRS 78.3784, only to the extent provided for pursuant to NRS 78.3793.
(f) Any corporate action not described in this
subsection that will result in the stockholder receiving money or scrip instead of fractional shares except where the stockholder
would not be entitled to receive such payment pursuant to NRS 78.205, 78.2055 or 78.207.
2. A stockholder who is entitled to dissent
and obtain payment pursuant to NRS 92A.300 to 92A.500, inclusive, may not challenge the corporate action creating the entitlement
unless the action is unlawful or fraudulent with respect to the stockholder or the domestic corporation.
3. From and after the effective date of
any corporate action described in subsection 1, no stockholder who has exercised the right to dissent pursuant to NRS 92A.300 to
92A.500, inclusive, is entitled to vote his or her shares for any purpose or to receive payment of dividends or any other distributions
on shares. This subsection does not apply to dividends or other distributions payable to stockholders on a date before the effective
date of any corporate action from which the stockholder has dissented.
(Added to NRS by 1995, 2087; A 2001, 1414, 3199;
2003, 3189; 2005, 2204; 2007, 2438; 2009, 1721)
NRS 92A.390 Limitations on right of
dissent: Stockholders of certain classes or series; action of stockholders not required for plan of merger.
1. There is no right of dissent with respect
to a plan of merger, conversion or exchange in favor of stockholders of any class or series which is:
(a) A covered security under section 18(b)(1)(A)
or (B) of the Securities Act of 1933, 15 U.S.C. § 77r(b)(1)(A) or (B), as amended;
(b) Traded in an organized market and has at
least 2,000 stockholders and a market value of at least $20,000,000, exclusive of the value of such shares held by the corporation’s
subsidiaries, senior executives, directors and beneficial stockholders owning more than 10 percent of such shares; or
(c) Issued by an open end management investment
company registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and which may be redeemed
at the option of the holder at net asset value, unless the articles of incorporation of the corporation issuing the class or series
provide otherwise.
2. The applicability of subsection 1 must
be determined as of:
(a) The record date fixed to determine the stockholders
entitled to receive notice of and to vote at the meeting of stockholders to act upon the corporate action requiring dissenter’s
rights; or
(b) The day before the effective date of such
corporate action if there is no meeting of stockholders.
3. Subsection 1 is not applicable and
dissenter’s rights are available pursuant to NRS 92A.380 for the holders of any class or series of shares who are required
by the terms of the corporate action requiring dissenter’s rights to accept for such shares anything other than cash or shares
of any class or any series of shares of any corporation, or any other proprietary interest of any other entity, that satisfies
the standards set forth in subsection 1 at the time the corporate action becomes effective.
4. There is no right of dissent for any
holders of stock of the surviving domestic corporation if the plan of merger does not require action of the stockholders of the
surviving domestic corporation under NRS 92A.130.
5. There is no right of dissent for any
holders of stock of the parent domestic corporation if the plan of merger does not require action of the stockholders of the parent
domestic corporation under NRS 92A.180.
(Added to NRS by 1995, 2088; A 2009, 1722)
NRS 92A.400 Limitations on right of
dissent: Assertion as to portions only to shares registered to stockholder; assertion by beneficial stockholder.
1. A stockholder of record may assert
dissenter’s rights as to fewer than all of the shares registered in his or her name only if the stockholder of record dissents
with respect to all shares of the class or series beneficially owned by any one person and notifies the subject corporation in
writing of the name and address of each person on whose behalf the stockholder of record asserts dissenter’s rights. The
rights of a partial dissenter under this subsection are determined as if the shares as to which the partial dissenter dissents
and his or her other shares were registered in the names of different stockholders.
2. A beneficial stockholder may assert
dissenter’s rights as to shares held on his or her behalf only if the beneficial stockholder:
(a) Submits to the subject corporation the written
consent of the stockholder of record to the dissent not later than the time the beneficial stockholder asserts dissenter’s
rights; and
(b) Does so with respect to all shares of which
he or she is the beneficial stockholder or over which he or she has power to direct the vote.
(Added to NRS by 1995, 2089; A 2009, 1723)
NRS 92A.410 Notification of stockholders
regarding right of dissent.
1. If a proposed corporate action creating
dissenters’ rights is submitted to a vote at a stockholders’ meeting, the notice of the meeting must state that stockholders
are, are not or may be entitled to assert dissenters’ rights under NRS 92A.300 to 92A.500, inclusive. If the domestic corporation
concludes that dissenter’s rights are or may be available, a copy of NRS 92A.300 to 92A.500, inclusive, must accompany the
meeting notice sent to those record stockholders entitled to exercise dissenter’s rights.
2. If the corporate action creating dissenters’
rights is taken by written consent of the stockholders or without a vote of the stockholders, the domestic corporation shall notify
in writing all stockholders entitled to assert dissenters’ rights that the action was taken and send them the dissenter’s
notice described in NRS 92A.430.
(Added to NRS by 1995, 2089; A 1997, 730; 2009,
1723)
NRS 92A.420 Prerequisites to demand
for payment for shares.
1. If a proposed corporate action creating
dissenters’ rights is submitted to a vote at a stockholders’ meeting, a stockholder who wishes to assert dissenter’s
rights with respect to any class or series of shares:
(a) Must deliver to the subject corporation,
before the vote is taken, written notice of the stockholder’s intent to demand payment for his or her shares if the proposed
action is effectuated; and
(b) Must not vote, or cause or permit to be
voted, any of his or her shares of such class or series in favor of the proposed action.
2. If a proposed corporate action creating
dissenters’ rights is taken by written consent of the stockholders, a stockholder who wishes to assert dissenters’
rights with respect to any class or series of shares must not consent to or approve the proposed corporate action with respect
to such class or series.
3. A stockholder who does not satisfy
the requirements of subsection 1 or 2 and NRS 92A.400 is not entitled to payment for his or her shares under this chapter.
(Added to NRS by 1995, 2089; A 1999, 1631; 2005,
2204; 2009, 1723)
NRS 92A.430 Dissenter’s notice:
Delivery to stockholders entitled to assert rights; contents.
1. The subject corporation shall deliver
a written dissenter’s notice to all stockholders entitled to assert dissenters’ rights.
2. The dissenter’s notice must be
sent no later than 10 days after the effective date of the corporate action specified in NRS 92A.380, and must:
(a) State where the demand for payment must
be sent and where and when certificates, if any, for shares must be deposited;
(b) Inform the holders of shares not represented
by certificates to what extent the transfer of the shares will be restricted after the demand for payment is received;
(c) Supply a form for demanding payment that
includes the date of the first announcement to the news media or to the stockholders of the terms of the proposed action and requires
that the person asserting dissenter’s rights certify whether or not the person acquired beneficial ownership of the shares
before that date;
(d) Set a date by which the subject corporation
must receive the demand for payment, which may not be less than 30 nor more than 60 days after the date the notice is delivered
and state that the stockholder shall be deemed to have waived the right to demand payment with respect to the shares unless the
form is received by the subject corporation by such specified date; and
(e) Be accompanied by a copy of NRS 92A.300
to 92A.500, inclusive.
(Added to NRS by 1995, 2089; A 2005, 2205; 2009,
1724)
NRS 92A.440 Demand for payment and
deposit of certificates; loss of rights of stockholder; withdrawal from appraisal process.
1. A stockholder who receives a dissenter’s
notice pursuant to NRS 92A.430 and who wishes to exercise dissenter’s rights must:
(a) Demand payment;
(b) Certify whether the stockholder or the beneficial
owner on whose behalf he or she is dissenting, as the case may be, acquired beneficial ownership of the shares before the date
required to be set forth in the dissenter’s notice for this certification; and
(c) Deposit the stockholder’s certificates,
if any, in accordance with the terms of the notice.
2. If a stockholder fails to make the
certification required by paragraph (b) of subsection 1, the subject corporation may elect to treat the stockholder’s shares
as after-acquired shares under NRS 92A.470.
3. Once a stockholder deposits that stockholder’s
certificates or, in the case of uncertified shares makes demand for payment, that stockholder loses all rights as a stockholder,
unless the stockholder withdraws pursuant to subsection 4.
4. A stockholder who has complied with
subsection 1 may nevertheless decline to exercise dissenter’s rights and withdraw from the appraisal process by so notifying
the subject corporation in writing by the date set forth in the dissenter’s notice pursuant to NRS 92A.430. A stockholder
who fails to so withdraw from the appraisal process may not thereafter withdraw without the subject corporation’s written
consent.
5. The stockholder who does not demand
payment or deposit his or her certificates where required, each by the date set forth in the dissenter’s notice, is not entitled
to payment for his or her shares under this chapter.
(Added to NRS by 1995, 2090; A 1997, 730; 2003,
3189; 2009, 1724)
NRS 92A.450 Uncertificated shares:
Authority to restrict transfer after demand for payment.
The subject corporation may restrict the transfer of shares
not represented by a certificate from the date the demand for their payment is received.
(Added to NRS by 1995, 2090; A 2009, 1725)
NRS 92A.460 Payment for shares: General
requirements.
1. Except as otherwise provided in NRS
92A.470, within 30 days after receipt of a demand for payment, the subject corporation shall pay in cash to each dissenter who
complied with NRS 92A.440 the amount the subject corporation estimates to be the fair value of the dissenter’s shares, plus
accrued interest. The obligation of the subject corporation under this subsection may be enforced by the district court:
(a) Of the county where the subject corporation’s
principal office is located;
(b) If the subject corporation’s principal
office is not located in this State, in the county in which the corporation’s registered office is located; or
(c) At the election of any dissenter residing
or having its principal or registered office in this State, of the county where the dissenter resides or has its principal or registered
office.
1. The court shall dispose of the complaint
promptly.
2. The payment must be accompanied by:
(a) The subject corporation’s balance
sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, a statement of income for that
year, a statement of changes in the stockholders’ equity for that year or, where such financial statements are not reasonably
available, then such reasonably equivalent financial information and the latest available quarterly financial statements, if any;
(b) A statement of the subject corporation’s
estimate of the fair value of the shares; and
(c) A statement of the dissenter’s rights
to demand payment under NRS 92A.480 and that if any such stockholder does not do so within the period specified, such stockholder
shall be deemed to have accepted such payment in full satisfaction of the corporation’s obligations under this chapter.
(Added to NRS by 1995, 2090; A 2007, 2704; 2009,
1725)
NRS 92A.470 Withholding payment for
shares acquired on or after date of dissenter’s notice: General requirements.
1. A subject corporation may elect to
withhold payment from a dissenter unless the dissenter was the beneficial owner of the shares before the date set forth in the
dissenter’s notice as the first date of any announcement to the news media or to the stockholders of the terms of the proposed
action.
2. To the extent the subject corporation
elects to withhold payment, within 30 days after receipt of a demand for payment, the subject corporation shall notify the dissenters
described in subsection 1:
(a) Of the information required by paragraph
(a) of subsection 2 of NRS 92A.460;
(b) Of the subject corporation’s estimate
of fair value pursuant to paragraph (b) of subsection 2 of NRS 92A.460;
(c) That they may accept the subject corporation’s
estimate of fair value, plus interest, in full satisfaction of their demands or demand appraisal under NRS 92A.480;
(d) That those stockholders who wish to accept
such an offer must so notify the subject corporation of their acceptance of the offer within 30 days after receipt of such offer;
and
(e) That those stockholders who do not satisfy
the requirements for demanding appraisal under NRS 92A.480 shall be deemed to have accepted the subject corporation’s offer.
3. Within 10 days after receiving the
stockholder’s acceptance pursuant to subsection 2, the subject corporation shall pay in cash the amount offered under paragraph
(b) of subsection 2 to each stockholder who agreed to accept the subject corporation’s offer in full satisfaction of the
stockholder’s demand.
4. Within 40 days after sending the notice
described in subsection 2, the subject corporation shall pay in cash the amount offered under paragraph (b) of subsection 2 to
each stockholder described in paragraph (e) of subsection 2.
(Added to NRS by 1995, 2091; A 2009, 1725)
NRS 92A.480 Dissenter’s estimate
of fair value: Notification of subject corporation; demand for payment of estimate.
1. A dissenter paid pursuant to NRS 92A.460
who is dissatisfied with the amount of the payment may notify the subject corporation in writing of the dissenter’s own estimate
of the fair value of his or her shares and the amount of interest due, and demand payment of such estimate, less any payment pursuant
to NRS 92A.460. A dissenter offered payment pursuant to NRS 92A.470 who is dissatisfied with the offer may reject the offer pursuant
to NRS 92A.470 and demand payment of the fair value of his or her shares and interest due.
2. A dissenter waives the right to demand
payment pursuant to this section unless the dissenter notifies the subject corporation of his or her demand to be paid the dissenter’s
stated estimate of fair value plus interest under subsection 1 in writing within 30 days after receiving the subject corporation’s
payment or offer of payment under NRS 92A.460 or 92A.470 and is entitled only to the payment made or offered.
(Added to NRS by 1995, 2091; A 2009, 1726)
NRS 92A.490 Legal proceeding to determine
fair value: Duties of subject corporation; powers of court; rights of dissenter.
1. If a demand for payment remains unsettled,
the subject corporation shall commence a proceeding within 60 days after receiving the demand and petition the court to determine
the fair value of the shares and accrued interest. If the subject corporation does not commence the proceeding within the 60-day
period, it shall pay each dissenter whose demand remains unsettled the amount demanded by each dissenter pursuant to NRS 92A.480
plus interest.
2. A subject corporation shall commence
the proceeding in the district court of the county where its principal office is located in this State. If the principal office
of the subject corporation is not located in the State, it shall commence the proceeding in the county where the principal office
of the domestic corporation merged with or whose shares were acquired by the foreign entity was located. If the principal office
of the subject corporation and the domestic corporation merged with or whose shares were acquired is not located in this State,
the subject corporation shall commence the proceeding in the district court in the county in which the corporation’s registered
office is located.
3. The subject corporation shall make
all dissenters, whether or not residents of Nevada, whose demands remain unsettled, parties to the proceeding as in an action against
their shares. All parties must be served with a copy of the petition. Nonresidents may be served by registered or certified mail
or by publication as provided by law.
4. The jurisdiction of the court in which
the proceeding is commenced under subsection 2 is plenary and exclusive. The court may appoint one or more persons as appraisers
to receive evidence and recommend a decision on the question of fair value. The appraisers have the powers described in the order
appointing them, or any amendment thereto. The dissenters are entitled to the same discovery rights as parties in other civil proceedings.
5. Each dissenter who is made a party
to the proceeding is entitled to a judgment:
(a) For the amount, if any, by which the court
finds the fair value of the dissenter’s shares, plus interest, exceeds the amount paid by the subject corporation; or
(b) For the fair value, plus accrued interest,
of the dissenter’s after-acquired shares for which the subject corporation elected to withhold payment pursuant to NRS 92A.470.
(Added to NRS by 1995, 2091; A 2007, 2705; 2009,
1727)
NRS 92A.500 Assessment of costs and
fees in certain legal proceedings.
1. The court in a proceeding to determine
fair value shall determine all of the costs of the proceeding, including the reasonable compensation and expenses of any appraisers
appointed by the court. The court shall assess the costs against the subject corporation, except that the court may assess costs
against all or some of the dissenters, in amounts the court finds equitable, to the extent the court finds the dissenters acted
arbitrarily, vexatiously or not in good faith in demanding payment.
2. The court may also assess the fees
and expenses of the counsel and experts for the respective parties, in amounts the court finds equitable:
(a) Against the subject corporation and in favor
of all dissenters if the court finds the subject corporation did not substantially comply with the requirements of NRS 92A.300
to 92A.500, inclusive; or
(b) Against either the subject corporation or
a dissenter in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted
arbitrarily, vexatiously or not in good faith with respect to the rights provided by NRS 92A.300 to 92A.500, inclusive.
3. If the court finds that the services
of counsel for any dissenter were of substantial benefit to other dissenters similarly situated, and that the fees for those services
should not be assessed against the subject corporation, the court may award to those counsel reasonable fees to be paid out of
the amounts awarded to the dissenters who were benefited.
4. In a proceeding commenced pursuant
to NRS 92A.460, the court may assess the costs against the subject corporation, except that the court may assess costs against
all or some of the dissenters who are parties to the proceeding, in amounts the court finds equitable, to the extent the court
finds that such parties did not act in good faith in instituting the proceeding.
5. To the extent the subject corporation
fails to make a required payment pursuant to NRS 92A.460, 92A.470 or 92A.480, the dissenter may bring a cause of action directly
for the amount owed and, to the extent the dissenter prevails, is entitled to recover all expenses of the suit.
6. This section does not preclude any
party in a proceeding commenced pursuant to NRS 92A.460 or 92A.490 from applying the provisions of N.R.C.P. 68 or NRS 17.115.
(Added to NRS by 1995, 2092; A 2009, 1727)