{"url_path":"/sec/aixi/10-k/2026/item-6","section_key":"item-6","section_title":"Item 6 Directors, Senior Management and","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1935172/0001213900-26-057986-index.html","accession_number":"0001213900-26-057986","cik":"0001935172","ticker":"AIXI","issuer_name":"Xiao-I Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/1935172/0001213900-26-057986-index.html","primary_entity_key":"0001935172","primary_entity_name":"Xiao-I Corp"},"word_count":4646,"has_tables":true,"body_markdown":"Item 6. Directors, Senior Management and\nEmployees.\n\n \n\nA. Directors and Senior Management.\n\n \n\nThe following table sets forth information regarding\nour directors and executive officers as of the date of this annual report.\n\n \n\n \n\n**Directors and Executive Officers**\n \n**Age** \n \n**Position/Title**\n\nMingqu Lin\n \n41\n \nChief Executive Officer\n\n*Yiyang Shen*\n \n31\n \nChief Financial Officer\n\n*Yunlin Yu*(1)(2)\n \n43\n \nIndependent Director\n\n*Jun Wang*(1)(2)(3)\n \n50\n \nIndependent Director\n\n*Binbin Zhang*(1)(2)(3)\n \n58\n \nIndependent Director\n\n*H. David Sherman*(1)(3)\n \n77\n \nIndependent Director\n\n \n\n(1)\nAudit committee member\n\n \n\n(2)\nCompensation committee member\n\n \n\n(3)\nNominating and Corporate Governance committee member\n\n \n\nThe current business address for our executive\nofficers and board of directors is c/o Xiao-I Corporation, Room 501, No. 363, Lane 1555, Jinshajiang West Road, Jiading District,, Shanghai,\nChina, 201103.\n\n \n\n**Director and Executive Officer Biographies**\n\n \n\n*Mr. Mingqu Lin*\n\n* *\n\nMr. Mingqu Lin received his education in Accounting\nat Guizhou University of Finance and Economics, where he attended from September 2004 to July 2008. From February 2015 to June 2018, Mr.\nLin served as a Sales Manager at Guizhou Laojiao Liquor Industry, where he was primarily responsible for liquor sales. From July 2018\nto September 2021, Mr. Lin served as Sales Director at Guizhou Yuanli Pharmaceutical Sales Co., Ltd., overseeing pharmaceutical sales\nmanagement operations. From March 2021 to September 2023, Mr. Lin worked in engineering management at Guizhou Hengtai Real Estate Development\nCo., Ltd., where his responsibilities primarily involved technical-related work. From September 2023 to August 2025, Mr. Lin served as\nDeputy General Manager of Guizhou Smart Home Co., Ltd., where he was responsible for the overall coordination and management of business\noperations.\n\n \n\n*Mr Yiyang Shen*\n\n \n\nMr. Yiyang Shen studied Financial Management (Corporate Finance focus)\nat Shanghai Business School from September 2016 to July 2019. From January 2021 to January 2022, he worked in administrative and financial\nfunctions at Shanghai Yuepai Food Co., Ltd. From January 2022 to January 2023, he served as an outsourced accountant at Shanghai Yige\nEnterprise Consulting Management Co., Ltd. From January 2023 to January 2024, he served as an Accounta\n\n \n\n87\n\n \n\n \n\n*Mr Yunlin Yu*\n\n* *\n\nYunlin Yu, is a citizen of the People’s\nRepublic of China. Mr. Yu received a bachelor’s degree in Industrial Design from Hubei Institute of Technology, where he attended\nfrom September 2001 to September 2004. Since 2016, Mr. Yu has been engaged in steel-related trading business as a businessperson. From\nSeptember 2004 to September 2016, Mr. Yu worked in the field of human resources management, with primary responsibilities including employee\ndeployment and employee benefits administration. In 2004, Mr. Yu served as a Human Resources Manager at Wugang Group Comprehensive Services\nCompany, where he was responsible for human resources administration.\n\n \n\n*Mr. Jun Wang*\n\n \n\nMr.\nJun Wang is an independent director of Xiao-I Corporation. From September 2000 to September 2020, Mr. Wang served as IoT Project Leader\nand Technical Director at Meipeng Hotel Management (Beijing) Co., Ltd., overseeing the smart agriculture division. He led or participated\nin multiple smart agriculture demonstration projects, covering core scenarios such as intelligent greenhouse environment control, crop\ngrowth monitoring, and precision irrigation system development. Since September 2020, he has served as Technical Management Leader and\nVice President of the company, responsible for applying IoT, big data, and AI technologies to hotel management practices, reducing operational\ncosts, and improving management efficiency. \n\n \n\n*Mr. Binbin Zhang*\n\n \n\nBinbin Zhang, is a citizen\nof the People’s Republic of China. From September 1990 to September 2023, he served at the Wuhan Railway Bureau Wuchang Power Supply\nSection, where he held the position of Chairman of the Labor Union. In this role, Mr. Zhang was primarily responsible for overseeing employee\nwelfare, labor relations, and internal personnel administration. Mr. Zhang received a bachelor’s degree in Railway Power Supply\nManagement and Human Resources Management from Railway Radio and Television University in 1990.\n\n \n\n*Mr. H. David Sherman*\n\n* *\n\nH. David Sherman is an independent director of\nXiao-I Corporation. Professor Sherman is a professor at Northeastern University, specializing in financial and management accounting,\nand contemporary accounting issues. Professor Sherman’s research areas include shareholder reporting and corporate governance; management\nand financial accounting, financing, and managing new ventures; service business productivity and data envelopment analysis; and mergers\nand acquisition performance measurement. Professor Sherman teaches Northeastern University MBA courses in accounting, control, and global\nfinancial statement analysis with a focus on international shareholder reporting. Professor Sherman currently serves as a board member\nand chair of the audit committee for Nuvve (NYSE: NVVE), Prestige Wealth Inc. (NASDAQ: PWM) Lakeshore Acquisition III Corp (NASDQ: LBBB),\nNatures Miracle Holdings, Inc (NMHI), He has served on the board and as audit chair of several U.S. and Chinese businesses, including\nKingold Corporation (NYSE: KGJI), China HGS Real Estate Inc. (NASDAQ: HGSH), Agfeed Corporation, Dunxin (DXF — NYSE/Amer) and China\nGrowth Alliance, Ltd. He also serves on a nonprofit board: American Academy of Dramatic Arts. Professor Sherman was in the faculty of\nthe Sloan School of Management at Massachusetts Institute of Technology from 1981 to 1984. He is a CPA, was an academic fellow at the\nSEC, and earned his master’s degree in business administration (MBA) in 1971 from Harvard Business School and his Doctorate Degree\nin Accounting and Accountability Systems from Harvard Business School in 1981.\n\n \n\n**Board Diversity**\n\n \n\nThe table below provides certain information regarding\nthe diversity of our board of directors as of the date of this annual report.\n\n \n\nBoard Diversity Matrix\n \n \n \n \n\nCountry of Principal Executive Offices\n \nChina\n \n \n\nForeign Private Issuer\nYes\n \n \n \n\nDisclosure Prohibited Under Home Country Law\nNo\n \n \n \n\nTotal Number of Directors\n4\n \n \n \n\nPart I: Gender Identity\nFemale\nMale\nNon-Binary\nDid Not\n\nDisclose Gender\n \n \n \n \n\nDirectors\n0\n4\n0\n0\n\nPart II: Demographic Background\n \n \n \n \n\nUnderrepresented Individual in Home Country Jurisdiction\n1\n \n \n \n\nLGBTQ+\n0\n \n \n \n\nDid Not Disclose Demographic Background\n0\n \n \n \n\n \n\n88\n\n \n\n \n\n**Family Relationships**\n\n \n\nThere are no family relationships among the directors\nand executive officers of the Company.\n\n \n\nB. Compensation.\n\n \n\n**Compensation of Directors and Executive Officers**\n\n \n\nFor the fiscal year ended December 31, 2025, we paid an aggregate of\nUS$442,421 in cash to our executive officers, and we paid US$72,957 to our non-executive director. We have not set aside or accrued any\namount to provide pension, retirement or other similar benefits to our directors and executive officers. WFOE and the PRC operating entities\nare required by law to make contributions equal to certain percentages of each employee’s salary for his or her pension insurance,\nmedical insurance, unemployment insurance and other statutory benefits and a housing provident fund.\n\n \n\n**Grant of Equity Awards to Officers**\n\n \n\nOn January 3, 2024 (the “Grant Date”), we granted Hui Yuan,\nour Chief Executive Officer (“CEO”), the right and option (the “Option”) to purchase 1,446,936.00 American Depository\nShares (the “Shares”) of the Company, at a price per share of US$2.07 (the “Exercise Price”) with one-third vesting\nannually over three years, beginning on the first anniversary of the Grant Date, pursuant to the Company’s 2023 Share Incentive\nPlan. In addition, we granted the CEO and Wei Weng, our Chief financial Officer (“CFO”) each, an award of 50,000 and 30,000\nRestricted Share Units (the “RSUs”), respectively (the “Award”). Each Restricted Share Unit represents the right\nto receive one American Depository Share of the Company. The RSUs fully vested upon grant. The Award payout shall be made to the CEO and\nCFO in a lump sum as soon as practicable, but in all cases within two and one-half (2-1/2) months following the vesting date, which is\nthe Grant Date. In 2025, pursuant to the 2023 Share Incentive Plan and the 2025Share Incentive Plan we granted a total of 71,559 RSUs\nto Director Wu Xiaomei, 11,988 RSUs to Director Xu Jun,and 48,678 RSUs to Director Lin Zhong. All of these equity incentives were fully\ndistributed in the same year.\n\n \n\n**Share Incentive Plans**\n\n \n\nTo promote the success and enhance the value of\nthe Company by linking the personal interests of the Directors, Employees, and Consultants to those of the Company’s shareholders\nand by providing such individuals with an incentive for outstanding performance to generate superior returns to the Company’s shareholders,\nthe Company adopted the following share incentive plans.\n\n \n\n*2025 Share Incentive Plan*\n\n \n\nOn April 1, 2025, the Company adopted our 2025\nShare Incentive Plan (the “2025 Plan”). Under the 2025 Plan, the maximum aggregate number of Ordinary Shares which may be\nissued pursuant to all awards shall initially be 4,214,684 shares, representing 12% of the total Ordinary Shares of the Company issued\nand outstanding on a fully diluted basis as of the adoption date of the Plan. In addition, on January 1 of each fiscal year following\nthe adoption of the 2025 Plan, if the aggregate number of Ordinary Shares reserved and available for future grants of awards under the\n2025 Plan falls below 3.0% of the total Ordinary Shares issued and outstanding on a fully diluted basis as of the last day of the immediately\npreceding calendar year (the “Limit”), the number of shares reserved for issuance under the 2025 Plan will automatically\nbe increased to equal the Limit, subject to the discretion of the Board to authorize additional increases. For these purposes, the number\nof Ordinary Shares issued and outstanding on a fully diluted basis is calculated by assuming the conversion, exercise, or exchange of\nall outstanding preferred shares, options, warrants, convertible notes, and other equity securities into Ordinary Shares. As of the date\nof this annual report, the Company have granted RSUs under the 2025 Plan, representing in total 1,407,144 ordinary shares, to three external\nconsultants for services, with the weighted average estimated fair value on the grant date of each ordinary shares underlying of $0.91.\nEach RSU represents the right to receive one ADS of the Group and fully vested upon grant.\n\n \n\nThe following paragraphs summarize the principal\nterms of the 2025 Plan.\n\n* *\n\n*Types of awards*. The 2025 Plan permits\nthe award of options, restricted shares, restricted share units, or other types of awards approved by the board of directors or the compensation\ncommittee.\n\n* *\n\n89\n\n \n\n* *\n\n*Plan administration*. Our board of directors\nor the compensation committee administers the 2025 Plan. The board or the committee determines, among other things, the participants to\nreceive awards, the type and number of awards granted, and the terms and conditions of each grant.\n\n* *\n\n*Award agreement*. Awards under the 2025\nPlan are evidenced by an award agreement that sets forth the terms, conditions, and limitations of each award, which may include the term\nof the award, provisions applicable upon a participant’s termination of service, and the Company’s authority to unilaterally\nor bilaterally amend, modify, suspend, cancel, or rescind an award.\n\n* *\n\n*Eligibility.* We may grant awards to our\nemployees, directors, and consultants.\n\n* *\n\n*Vesting schedule.* The vesting schedule\nfor each award is determined by the plan administrator or, in its absence, the compensation committee, and is specified in the relevant\naward agreement.\n\n* *\n\n*Exercise of awards.* The exercise price\nper share subject to an option is determined by the plan administrator or the compensation committee and set forth in the award agreement,\nand may be a fixed price or a variable price related to the fair market value of the shares. The exercise period and expiration of options\nare also determined at the time of grant.\n\n* *\n\n*Transfer restrictions*. Awards under the\n2025 Plan may not be transferred by a participant other than in limited circumstances, such as transfers to family members, trusts, or\nother permitted entities, subject to the approval of the plan administrator.\n\n* *\n\n*Termination and amendment.* Unless terminated\nearlier, the 2025 Plan will remain in effect for ten years from the date of its adoption. Our board of directors may terminate, amend,\nor modify the 2025 Plan, subject to applicable laws and provided that no such action may materially adversely affect any previously granted\naward without the participant’s consent.\n\n* *\n\n*2023 Share Incentive Plan*\n\n \n\nOn November 30, 2022, the Company adopted our\n2023 share incentive plan (the “2023 Plan”), to promote the success and enhance the value of the Company by linking the personal\ninterests of the Directors, Employees, and Consultants to those of the Company’s shareholders and by providing such individuals\nwith an incentive for outstanding performance to generate superior returns to the Company’s shareholders. Under the 2023 Plan,\nthe maximum aggregate number of Ordinary Shares which may be issued pursuant to all awards under such plan shall initially be 2,600,000,\nprovided, that if the aggregate number of Ordinary Shares reserved and available for future grants of awards under the 2023 Plan falls\nbelow 3.0% of the total Ordinary Shares in issue and outstanding on the last day of the immediately preceding calendar year (the “Limit”),\nsuch number shall automatically be increased so that the aggregate number of Ordinary Shares reserved and available for future grants\nof awards under the 2023 Plan shall be equal to the Limit on January 1 thereafter, assuming, for purposes of determining the number of\nOrdinary Shares outstanding on such date, that all preferred shares, options, warrants, convertible notes and other equity securities\nthat are convertible into or exercisable or exchangeable for Shares (whether or not by their terms then currently convertible, exercisable\nor exchangeable) that were outstanding on such date, are deemed to have been so converted, exercised or exchanged. As of the date of\nthis annual report, we have granted awards under the 2023 Plan, with 2,558,628 ordinary shares issued or issuable upon the vesting of\noutstanding RSUs and options, and 41,372 ordinary shares remaining available for future issuance under the 2023 Plan.\n\n \n\nThe following paragraphs summarize the principal\nterms of the 2023 Plan.\n\n \n\n*Types of awards*. The 2023 Plan permits\nthe awards of options, restricted shares, restricted share units or any other type of awards approved by our board of directors or compensation\ncommittee of the board.\n\n \n\n*Plan administration*. Our board of directors\nor the compensation committee shall administer the 2023 Plan. The board or the committee shall determine, among other things, the participants\nto receive awards, the type and number of awards to be granted to each participant, and the terms and conditions of each award grant.\n\n \n\n90\n\n \n\n \n\n*Award agreemen*t. Awards granted under the\n2023 Plan are evidenced by an award agreement that sets forth terms, conditions and limitations for each award, which may include the\nterm of the award, the provisions applicable in the event of the grantee’s employment or service terminates, and our authority to\nunilaterally or bilaterally amend, modify, suspend, cancel or rescind the award.\n\n \n\n*Eligibility*. We may grant awards to our\nemployees, directors and consultants.\n\n \n\n*Vesting schedule*. In general, the plan\nadministrator or, in its absence, the compensation committee determines the vesting schedule, which is specified in the relevant award\nagreement.\n\n \n\n*Exercise of awards*. The exercise price\nper share subject to an option is determined by the plan administrator or, the compensation committee and set forth in the award agreement,\nwhich may be a fixed price or a variable price related to the fair market value of the shares. The vested portion of option will expire\nif not exercised prior to the time as the plan administrator or, the compensation committee determines at the time of its grant.\n\n \n\n*Transfer restrictions*. Awards may not be\ntransferred in any manner by the eligible participant other than in accordance with the limited exceptions, such as transfers to our Company\nor a subsidiary of ours, transfers to the immediate family members of the participant by gift, the designation of a beneficiary to receive\nbenefits if the participant dies, permitted transfers or exercises on behalf of the participant by the participant’s duly authorized\nlegal representative if the participant has suffered a disability, or, subject to the prior approval of the plan administrator or our\nexecutive officer or director authorized by the plan administrator, transfers to one or more natural persons who are the participant’s\nfamily members or entities owned and controlled by the participant and/or the participant’s family members, including but not limited\nto trusts or other entities whose beneficiaries or beneficial owners are the participant and/or the participant’s family members,\nor to such other persons or entities as may be expressly approved by the plan administrator, pursuant to such conditions and procedures\nas the plan administrator may establish.\n\n \n\n*Termination and amendment*. Unless terminated\nearlier, the 2023 Plan has a term of ten years. Our board of directors may terminate, amend or modify the plan, subject to the limitations\nof applicable laws. However, no such action may adversely affect in any material way any award previously granted without prior written\nconsent of the participant.\n\n  \n\n**Limitation on Liability and Other Indemnification\nMatters**\n\n \n\nCayman Islands law does not limit the extent to\nwhich a company’s memorandum and articles of association may provide for indemnification of officers and directors, except to the\nextent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification\nagainst civil fraud or the consequences of committing a crime. Our Memorandum and Articles of Association provide that that we shall indemnify\nour directors and officers, and their personal representatives, against all actions, proceedings, costs, charges, expenses, losses, damages\nor liabilities incurred or sustained by such persons, other than by reason of such person’s dishonesty, willful default or fraud,\nin or about the conduct of our Company’s business or affairs (including as a result of any mistake of judgment) or in the execution\nor discharge of his duties, powers, authorities or discretions, including without prejudice to the generality of the foregoing, any costs,\nexpenses, losses or liabilities incurred by such director or officer in defending (whether successfully or otherwise) any civil proceedings\nconcerning our Company or its affairs in any court whether in the Cayman Islands or elsewhere.\n\n \n\nIn addition, we entered into indemnification agreements\nwith each of our directors and executive officers. Under these agreements, we agree to indemnify our directors and executive officers\nagainst certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director or\nofficer of our Company.\n\n \n\nInsofar as indemnification for liabilities arising\nunder the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have\nbeen informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is\ntherefore unenforceable.\n\n \n\n91\n\n \n\n \n\nC. Board Practices.\n\n \n\nOur board of directors consists of four directors.\nA director is not required to hold any shares in our Company to qualify to serve as a director. A director who is in any way, whether\ndirectly or indirectly, interested in a contract or transaction or proposed contract or transaction with our Company is required to declare\nthe nature of his interest at a meeting of our directors. A director may vote with respect to any contract or transaction or proposed\ncontract or transaction notwithstanding that he may be interested therein, and if she/he does so his vote shall be counted and he may\nbe counted in the quorum at any meeting of our directors at which any such contract or transaction is considered. Our directors may exercise\nall the powers of our Company to borrow money, mortgage or charge its undertaking, property and uncalled capital and to issue debentures\nor other securities whenever money is borrowed or as security for any debt, liability or obligation of our Company or of any third party.\n\n \n\n*Director Independence*\n\n \n\nOur board has reviewed the independence of\nour directors, applying Nasdaq independence standards. Based on this review, the board determined that each H. David Sherman, Yunlin\nYu, Jun Wang and Binbin Zhang is “independent” within the meaning of the Nasdaq Global Market rules. In making this\ndetermination, our board considered the relationships that each of these non-employee director candidates has with us and all other\nfacts and circumstances our board deemed relevant in determining their independence. As required under applicable Nasdaq Global\nMarket rules, our independent directors will meet on a regular basis as often as necessary to fulfill their responsibilities,\nincluding at least annually in executive session without the presence of non-independent directors and management.\n\n \n\nCommittees of the Board of Directors\n\n \n\nWe have three committees under the board of directors\nwith a charter for each of the three committees. Each committee’s members and functions are described below.\n\n \n\n**Audit Committee**. Our audit committee\nconsists of H. David Sherman, Jun Wang and Binbin Zhang, and is chaired by H. David Sherman. Each committee member satisfies the “independence”\nrequirements of Rule 5605(c)(2) of the Listing Rules of the Nasdaq Global Market and meets the independence standards under Rule 10A-3\nunder the Exchange Act. We have determined that H. David Sherman qualifies as an “audit committee financial expert.” The\naudit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our Company.\nThe audit committee is responsible for, among other things:\n\n \n\n●selecting the independent registered\npublic accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered\npublic accounting firm;\n\n \n\n●reviewing with the independent\nregistered public accounting firm any audit problems or difficulties and management’s response;\n\n \n\n●reviewing and approving all\nproposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;\n\n \n\n●discussing the annual audited\nfinancial statements with management and the independent registered public accounting firm;\n\n \n\n●reviewing major issues as to\nthe adequacy of our internal controls and any special audit steps adopted in light of material control deficiencies;\n\n \n\n●annually reviewing and reassessing\nthe adequacy of our audit committee charter;\n\n \n\n●meeting separately and periodically\nwith management and the independent registered public accounting firm; and\n\n \n\n●reporting regularly to the\nboard.\n\n \n\n92\n\n \n\n \n\n**Compensation Committee**. Our compensation\ncommittee consists of Yunlin Yu, Jun Wang and Binbin Zhang, and is chaired by Yunlin Yu. Except for Yunlin Yu, Jun Wang and Binbin Zhang\neach satisfies the “independence” requirements of Rule 5605(c)(2) of the Listing Rules of the Nasdaq Global Market.\nThe compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation,\nrelating to our directors and executive officers. Our chief executive officer may not be present at any committee meeting during which\nhis compensation is deliberated upon. The compensation committee is responsible for, among other things:\n\n \n\n●reviewing the total compensation\npackage for our executive officers and making recommendations to the board with respect to it;\n\n \n\n●reviewing the compensation\nof our non-employee directors and making recommendations to the board with respect to it; and\n\n \n\n●periodically reviewing and\napproving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, and employee pension\nand welfare benefit plans.\n\n \n\n**Nominating and Corporate Governance\nCommittee**. Our nominating and corporate governance committee consists of Yunlin Yu, Jun Wang, Binbin Zhang and H. David\nSherman, and is chaired by Yunlin Yu,. Except for Yunlin Yu, Jun Wang, Binbin Zhang and H. David Sherman each satisfies the\n“independence” requirements of Rule 5605(c)(2) of the Listing Rules of the Nasdaq Global Market. The nominating\ncommittee assists the board in selecting individuals qualified to become our directors and in determining the composition of the\nboard and its committees. The nominating committee is responsible for, among other things:\n\n \n\n●recommending nominees to the\nboard for election or re-election to the board, or for appointment to fill any vacancy on the board;\n\n \n\n●reviewing annually with the\nboard the current composition of the board with regards to characteristics such as independence, age, skills, experience and availability\nof service to us;\n\n \n\n●selecting and recommending\nto the board the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating\ncommittee itself; and\n\n \n\n●monitoring compliance with\nour code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.\n\n \n\n**Duties of Directors**\n\n \n\nUnder Cayman Islands law, our directors owe fiduciary\nduties to our Company, including (i) duty to act in good faith in what the director or officer believes to be in the best interests of\nthe company as a whole; (ii) duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose;\n(iii) directors should not improperly fetter the exercise of future discretion; (iv) duty to exercise powers fairly as between different\nsections of shareholders; (v) duty to exercise independent judgment; and (vi) duty not to put themselves in a position in which there\nis a conflict between their duty to the company and their personal interests. Our directors also owe to our Company a duty to act with\nskill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill\nthan may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards\nan objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.\nIn fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association, as amended\nand restated from time to time. We have the right to seek damages if a duty owed by our directors is breached. In limited exceptional\ncircumstances, a shareholder may have the right to seek damages in our name if a duty owed by our directors is breached.\n\n \n\n93\n\n \n\n \n\n**Terms of Directors**\n\n \n\nOur directors may be elected by a resolution of\nour board of directors, or by an ordinary resolution of our shareholders. Our directors are not subject to a term of office and hold office\nuntil such time as they are removed from office by ordinary resolution of the shareholders. A director will cease to be a director if,\namong other things, the director (i) becomes bankrupt or makes any arrangement or composition with his creditors; (ii) dies or is found\nby our Company to be or becomes of unsound mind, (iii) resigns his office by notice in writing to the company, or (iv) without special\nleave of absence from our board, is absent from three consecutive board meetings and our directors resolve that his office be vacated.\n\n \n\nD. Employees.\n\n \n\nAs of May 1, 2026, we had 58 full-time employees.\nThe following table sets forth the number of our full-time employees by function as of May 1, 2026:\n\n \n\nFunction/Department \n  \n\nManagement \n 12 \n\nSales and Marketing \n 3 \n\nResearch and Development \n 27 \n\nProduction \n 16 \n\nTotal \n 58 \n\n \n\nOur success depends on our ability to attract,\nretain and motivate qualified employees. As part of our human resource strategy, we offer employees a dynamic work environment, competitive\nsalaries, performance-based cash bonuses and other incentives. As a result, we have generally been able to attract and retain qualified\npersonnel and maintain a stable core management team.\n\n \n\nWe primarily recruit our employees through on-campus\njob fairs, recruitment agencies and online channels, including our corporate website and third-party employment websites. We provide regular\ntraining and reviews to our employees to enhance their performance.\n\n \n\nSubstantially all of our employees as of May\n1, 2026 are stationed in China. We enter into standard employment, confidentiality and non-compete agreements with our employees. As\nrequired by PRC laws and regulations, we participate in housing fund and various employee social security plans that are organized by\napplicable local municipal and provincial governments, including housing, pension, medical, work-related injury and unemployment benefit\nplans.\n\n \n\nBy deploying AI Co-pilot systems across development\nworkflows, we have significantly reduced dependency on junior engineers while expanding strategic roles in senior architecture design,\nprompt engineering, and AI model training in 2024.\n\n \n\nNone of our employees are currently represented\nby labor unions. We believe that we maintain good working relationship with our employees and, except as disclosed in Item 8.A. “Consolidated\nStatements and Other Financial Information—Litigation,” we have not experienced any material labor disputes.\n\n \n\nE. Share Ownership.\n\n \n\nFor information regarding the share ownership\nof directors and officers, see “Item 7.A. Major Shareholders and Related Party Transactions—Major Shareholders.” For\ninformation as to our equity incentive plan, see “Item 6.B. Director, Senior Management and Employees—Compensation—2025\nShare Incentive Plan.”\n\n \n\nF. Disclosure of a Registrant’s\nAction to Recover Erroneously Awarded Compensation.\n\n \n\nNot applicable.\n\n \n\n94"}