<SEC-DOCUMENT>0001213900-24-074017.txt : 20240830
<SEC-HEADER>0001213900-24-074017.hdr.sgml : 20240830
<ACCEPTANCE-DATETIME>20240829190046
ACCESSION NUMBER:		0001213900-24-074017
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20240829
FILED AS OF DATE:		20240830
DATE AS OF CHANGE:		20240829

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			HIGHWAY HOLDINGS LTD
		CENTRAL INDEX KEY:			0001026785
		STANDARD INDUSTRIAL CLASSIFICATION:	MISCELLANEOUS FABRICATED METAL PRODUCTS [3490]
		ORGANIZATION NAME:           	04 Manufacturing
		IRS NUMBER:				000000000
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-38490
		FILM NUMBER:		241265326

	BUSINESS ADDRESS:	
		STREET 1:		LEVEL 18 LANDMARK N 39 LUNG SUM AVE
		STREET 2:		STE 1801
		CITY:			SHEUNG SHUI
		STATE:			K3
		ZIP:			00000
		BUSINESS PHONE:		011-86-755-2813-6056

	MAIL ADDRESS:	
		STREET 1:		LEVEL 18 LANDMARK N 39 LUNG SUM AVE
		STREET 2:		STE 1801
		CITY:			SHEUNG SHUI
		STATE:			K3
		ZIP:			999999999
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>ea0212902-6k_highway.htm
<DESCRIPTION>REPORT OF FOREIGN PRIVATE ISSUER
<TEXT>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">SECURITIES
AND EXCHANGE COMMISSION</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Washington,
D.C. 20549</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>FORM
6-K</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">REPORT
OF FOREIGN PRIVATE ISSUER</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PURSUANT
TO RULE 13a-16 OR 15d-16 OF</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">THE
SECURITIES EXCHANGE ACT OF 1934</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the month of August 2024</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Commission
File Number 001-38490</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">HIGHWAY
HOLDINGS LIMITED</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0.25in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Translation
of Registrant&rsquo;s Name Into English)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Suite
1801, Level 18</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Landmark
North</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">39
Lung Sum Avenue</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Sheung
Shui</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">New
Territories, Hong Kong</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Address
of Principal Executive Offices)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Indicate
by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Form 20-F&nbsp;&#9746;&nbsp;&nbsp;&nbsp;&nbsp;
Form 40-F&nbsp;&#9744;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Commencing
on August 29, 2024, the Company mailed to its shareholders certain materials related to the Annual Meeting of Shareholders to be held
at the offices of TroyGould PC, 1801 Century Park East, 16<SUP>th</SUP> Floor, Los Angeles, California U.S.A., on Friday, October 11,
2024. The Annual Meeting materials included the following:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-indent: 0.5in; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.
An Annual Report, which consisted of the <A HREF="http://www.sec.gov/ix?doc=/Archives/edgar/data/1026785/000121390024061773/ea0209205-20f_highway.htm">Form 20-F</A> report filed on July 16, 2024 with the U.S. Securities and Exchange Commission (the
&ldquo;SEC&rdquo;) and a letter to the shareholders from the Company&rsquo;s President and Chief Executive Officer. The Form 20-F is
available on the SEC&rsquo;s website at http://www.sec.gov and the full Annual Report is available at the Company&rsquo;s website at www.highwayholdings.com,
Investor Information. Attached hereto is a copy of the letter to the shareholders that was included in the Annual Report.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-indent: 0.5in; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-indent: 0.5in; margin-top: 0pt; margin-bottom: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT>2. The
Company&rsquo;s Notice of Annual Meeting of Shareholders and the Proxy Statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Exhibit
Index</U>.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom">
    <TD STYLE="text-align: left; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; width: 9%"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Exhibit&nbsp;No.</B></FONT></P></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; width: 1%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; width: 90%; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Description</B></FONT></TD></TR>
  <TR STYLE="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">99.1</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="ea021290201ex99-1_highway.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notice of Annual Meeting of Shareholders and the Proxy Statement.</FONT></A></TD></TR>
  <TR STYLE="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
  <TR STYLE="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">99.2</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="ea021290201ex99-2_highway.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Letter to Shareholders.</FONT></A></TD></TR>
  </TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>SIGNATURES</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 228.95pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">HIGHWAY HOLDINGS LIMITED</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD STYLE="width: 60%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 35%">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>Date:&nbsp;&nbsp;August 29, 2024</TD>
    <TD>By</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid">/s/ ROLAND W. KOHL</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>Roland W. Kohl</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Executive Officer</TD></TR>
  </TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 228.95pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 228.95pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">3</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 228.95pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 228.95pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ea021290201ex99-1_highway.htm
<DESCRIPTION>NOTICE OF ANNUAL MEETING OF SHAREHOLDERS AND THE PROXY STATEMENT
<TEXT>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 99.1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>HIGHWAY HOLDINGS LIMITED</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Suite 1801, Level 18</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Landmark North </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>39 Lung Sum Avenue</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Sheung Shui</B></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">New Territories, Hong Kong</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><BR>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">October 11, 2024</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Notice is hereby given that
the Annual Meeting of Shareholders of Highway Holdings Limited (the &ldquo;Company&rdquo;), will be held at the offices of TroyGould PC,
1801 Century Park East, Suite 1600, Los Angeles, California U.S.A., on Friday, October 11, 2024, at 8:00 a.m., for the following purposes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">(1) To
elect one member of the Company&rsquo;s Board of Directors to serve until the 2027 Annual Meeting of Shareholders;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">(2) To
ratify the selection by the Board of Directors of ARK Pro CPA &amp; Co as the independent accountants of the Company for the fiscal year
ending March 31, 2025; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">(3) To
approve an amendment to the Company&rsquo;s 2020 Stock Option and Restricted Stock Plan (the &ldquo;2020 Option Plan&rdquo;) to increase
the number of shares authorized for issuance by 500,000 shares; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">(4) To
transact such other business as may properly come before the meeting or any adjournment thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Your attention is directed
to the accompanying proxy statement. Only shareholders of record at the close of business on August 19, 2024 will be entitled to notice
of and to vote at the meeting and any adjournment thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>Important Notice Regarding
the Availability of Proxy Materials for the Shareholders&rsquo; Meeting to Be Held on Friday, October 11, 2024 at 8:00 a.m. Pacific time
at the offices of TroyGould PC, 1801 Century Park East, Suite 1600, Los Angeles, California U.S.A.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>The Proxy Statement and 2024
annual report to shareholders, or Annual Report, are available at http://edocumentview.com/HIHO.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
    <TD STYLE="width: 60%">&nbsp;</TD>
    <TD STYLE="width: 40%">By Order of the Board of Directors</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid">/s/ <FONT STYLE="font-size: 10pt"><B>Alan Chan</B></FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt"><B>Alan Chan</B>, Secretary</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>Hong Kong</TD>
    <TD>&nbsp;</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>August 29, 2024</TD>
    <TD>&nbsp;</TD></TR>
  </TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">HIGHWAY HOLDINGS LIMITED</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Suite 1801, Level 18</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Landmark North </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>39 Lung Sum Avenue</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Sheung Shui</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>New Territories, Hong Kong</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PROXY STATEMENT</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Annual Meeting of Shareholders</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">October 11, 2024</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">INTRODUCTION</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Persons Making the Solicitation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This Proxy Statement is furnished
in connection with the solicitation by the Board of Directors of Highway Holdings Limited, a British Virgin Islands corporation (the &ldquo;Company&rdquo;),
of proxies for use at the Annual Meeting of Shareholders to be held at 8:00 a.m. at the offices of TroyGould PC, 1801 Century Park East,
Suite 1600, Los Angeles, California U.S.A., on Friday, October 11, 2024, and at any adjournment thereof (the &ldquo;Annual Meeting&rdquo;).
This proxy statement is first being mailed to shareholders on or about August 29, 2024. You are requested to submit your proxy by Internet
by following the Internet voting instructions on the enclosed proxy card, or to sign, date and return the enclosed proxy card in order
to ensure that your shares are represented at the Annual Meeting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A form of proxy is enclosed
for your use. The shares represented by each properly executed unrevoked proxy will be voted as directed by the shareholder executing
the proxy. If no direction is made, the shares represented by each properly executed unrevoked proxy will be voted (i) &ldquo;FOR&rdquo;
the election of management&rsquo;s nominee for the Board of Directors to be elected as the Class II director to serve until the 2027 Annual
Meeting of Shareholders, (ii) &ldquo;FOR&rdquo; the ratification of the selection by the Board of Directors of ARK Pro CPA &amp; Co as
the independent accountants of the Company for the fiscal year ending March 31, 2025 and (iii) &ldquo;FOR&rdquo; the approval of an amendment
to the 2020 Option Plan to increase the shares authorized for issuance by 500,000 shares. With respect to any other item of business that
may come before the Annual Meeting, the proxy holders will vote the proxy in accordance with the recommendation of management of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The cost of solicitation of
proxies, including the cost of preparation and mailing of the Notice of Annual Meeting, this Proxy Statement, and the enclosed proxy,
will be borne by the Company. It is anticipated that brokerage houses, fiduciaries, nominees, and others will be reimbursed for their
out-of-pocket expenses in forwarding proxy material to beneficial owners of stock held in their names. Directors, officers, or employees
of the Company may solicit proxies by telephone or in person without additional compensation.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">How to Vote</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white"><I>Shareholder
of Record: Shares Registered in Your Name</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If, on the Record Date, your
shares were registered directly in your name with our transfer agent, Computershare, then you are a shareholder of record. If you are
a shareholder of record, there are three ways to vote:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>By Internet</I> &ndash;
To vote through the Internet, go to <B>www.investorvote.com/HIHO</B> to complete an electronic proxy card. You will be asked to provide
the control number from the enclosed proxy card. Your Internet vote must be received by 11:59 p.m. Eastern Time on October 10, 2024 to
be counted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>By Mail</I> &ndash; You
may do this by marking, dating and signing your proxy card or, for shares held in street name, the voting instruction card provided to
you by your broker or nominee, and mailing it in the enclosed, pre-addressed envelope.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>In Person</I> &ndash; You
may vote in person at the Annual Meeting and we will give you a ballot when you arrive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Beneficial Owner: Shares
Registered in the Name of Broker, Bank or Other Nominee</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If you are a beneficial owner
of shares registered in the name of your broker, bank, or other nominee, you should have received a voting instruction form with these
proxy materials from that organization rather than from us. Simply complete and mail the voting instruction form to ensure that your vote
is counted. Alternatively, you may vote over the Internet as instructed by your broker, bank or other nominee. To vote in person at the
Annual Meeting, you must obtain a valid proxy from your broker, bank or other nominee. Follow the instructions from your broker, bank
or other nominee included with these proxy materials, or contact your broker, bank or other nominee to request a proxy form.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revocability of Proxy</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any proxy given by a shareholder
of the Company may be revoked at any time before it is voted at the Annual Meeting by a written notice to the Secretary of the Company,
or upon request if the shareholder is present at the meeting. Each valid proxy submitted by Internet, or returned via mail, that is not
revoked, unless indicated otherwise on the proxy card, will be voted in the election of directors for the nominee as described herein.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Voting Securities</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Holders of record of the Company&rsquo;s
Common Shares, $0.01 par value (the &ldquo;Common Shares&rdquo;), at the close of business on August 19, 2024 (the &ldquo;Record Date&rdquo;)
are entitled to notice of and to vote at the meeting or any adjournment thereof. As of the Record Date, there were 4,401,825 Common Shares
issued and outstanding. Holders of Common Shares are entitled to cast one vote per share on each matter presented for consideration and
action by the shareholders. The presence, in person or by proxy, of shareholders entitled to cast at least a majority of the outstanding
Common Shares will constitute a quorum for the transaction of business at the Annual Meeting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Abstentions may be specified
as to all proposals to be brought before the Annual Meeting other than the election of directors. Votes cast by proxy or in person at
the Annual Meeting will be tabulated by the inspectors of election appointed for the meeting and will determine whether or not a quorum
is present. The inspectors of election will treat abstentions as shares that are present and entitled to vote for purposes of determining
the presence of a quorum, but as unvoted for purposes of determining the approval of any matter submitted to the shareholders for a vote.
Ratification of the selection of the independent accountants will require the affirmative vote of at least a majority in voting interest
of the shareholders present in person or by proxy at the Annual Meeting and entitled to vote thereon.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Class II director to be
elected at the Annual Meeting will be elected by a plurality of the votes cast. The nominee who receives the highest number of affirmative
votes cast will be elected as the Class II director. Only votes cast for a nominee will be counted, except that each properly executed
unrevoked proxy will be voted for management&rsquo;s nominee for the Board of Directors in the absence of instructions to the contrary.
Abstentions, broker non-votes and instructions on a proxy to withhold authority to vote for management&rsquo;s nominee will result in
the nominee receiving fewer votes.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Annual Report</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This Proxy Statement is accompanied
by the Annual Report of the Company for the fiscal year ended March 31, 2024. Shareholders are encouraged to read the Annual Report in
connection with the information contained herein. This proxy statement, the proxy card and the Annual Report are available at <B><I>http://www.investorvote.com/HIHO</I></B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B>What is the quorum requirement?</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A quorum of shareholders is
necessary to hold a valid meeting. A quorum will be present if stockholders holding at least a majority of our then outstanding shares
of the common stock entitled to vote are present at the Annual Meeting in person or represented by proxy. On the Record Date, there were
4,401,825 shares issued and outstanding and entitled to vote.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Your shares will be counted
towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank or other nominee) or if you
vote in person at the Annual Meeting. If there is no quorum, the holders of a majority of shares present at the Annual Meeting in person
or represented by proxy may adjourn the Annual Meeting to another date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B>What if I return a proxy
card or otherwise vote but do not make specific choices?</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If you return a signed and
dated proxy card or otherwise vote without marking voting selections, your shares will be voted, as applicable:</P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">&ldquo;<B>For</B>&rdquo; the election of one (1) Class II
director to serve on our Board for a three-year term.</TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">&ldquo;<B>For</B>&rdquo; the ratification of the selection
of ARK Pro CPA &amp; Co as our independent registered public accounting firm for the fiscal year ending March 31, 2025.</TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">&ldquo;<B>For</B>&rdquo; the approval of an amendment to the
2020 Option Plan to increase the shares authorized for issuance by 500,000 shares</TD>
</TR></TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If any other matter is properly
presented at the Annual Meeting, your proxyholder (named on your proxy card) will vote your shares using their best judgment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PROPOSAL I - ELECTION OF DIRECTORS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The directors and executive
officers of the Company as of August 29, 2024 are listed below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1.5pt solid; width: 35%">
    <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Name</P></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: center; width: 6%">Age</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; width: 55%">Positions</TD></TR>
  <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Roland W. Kohl</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">75</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Executive Officer, Director, Chairman of the Board</TD></TR>
  <TR STYLE="vertical-align: top; background-color: White">
    <TD>Ringo Tsang</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">58</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Operating Officer</TD></TR>
  <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Alan Chan</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">60</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Financial Officer, Secretary</TD></TR>
  <TR STYLE="vertical-align: top; background-color: White">
    <TD>Tiko Aharonov <SUP>(1) (2)</SUP></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">77</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD></TR>
  <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Irene Wong Ping Yim <SUP>(1) (2)</SUP></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">58</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD></TR>
  <TR STYLE="vertical-align: top; background-color: White">
    <TD>Heiko Sonnekalb <SUP>(1) (2)</SUP></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">53</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD></TR>
  <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Dirk Hermann, Ph.D.</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">60</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD></TR>
  </TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(1)</TD><TD STYLE="text-align: justify">Current member of Audit Committee.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(2)</TD><TD STYLE="text-align: justify">Member of Compensation Committee</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Directors hold office
until their term has expired and they are re-elected at an annual meeting of shareholders. The Company&rsquo;s Amended and Restated Memorandum
and Articles of Association provide that the Board of Directors is divided into three classes of directors with staggered terms of office.
At each annual meeting of shareholders, the members of one class of directors will be elected for a term of office to expire at the third
succeeding annual meeting of shareholders after their election, and until their successors have been duly elected and qualified. At the
Annual Meeting, the terms of one class of directors will expire, and the nominee for that class will be nominated to hold office for a
three-year term expiring at the 2027 annual meeting. All directors hold office until their respective terms expire and until his or her
successor is elected, or until his or her death, resignation, or removal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The candidate receiving the
highest number of affirmative votes cast at the Annual Meeting shall be elected as director of the Company. The nominee listed below has
agreed to serve if elected. If for any reason the nominee named below is not a candidate when the election occurs, the Company intends
to vote proxies for a substitute nominee or, in lieu thereof, our Board of Directors may reduce the number of directors in accordance
with our Amended and Restated Memorandum and Articles of Association. Unless otherwise instructed, the proxy holders will vote the proxies
received by them in a manner that will result in the election of the nominee named below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have one incumbent director
in Class II whose term expires at the Annual Meeting. The Board of Directors has nominated the incumbent Class II director, Heiko Sonnekalb,
for reelection as Class II director to serve until the 2027 annual meeting of the shareholders and until his successor is duly elected
and qualified. We believe that Heiko Sonnekalb will be available and able to serve as director. In the event that he is unable or unwilling
to serve, the proxy holders will vote the proxies for such other nominee as they may determine.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Heiko Sonnekalb</B>. Mr.
Sonnekalb was appointed to the Board of Directors on April 1, 2020. Mr. Sonnekalb currently serves as the chief executive officer of Dr.
Arnold Schaefer GmbH, a German holding company, Lakal GmbH, a German manufacturer of shutter blinds, and Bartz Werke GmbH, a German casting
foundry and heat and pipe technology company. In addition, he serves as a member of the supervisory board of Germany-based Herwick AG
and Stadtwerke Voelklingen Vertrieb GmbH. Mr. Sonnekalb also is a committee member of both the IHK Saarland Industrial Research and Foreign
Trade Committee and the DIHK Berlin Industrial Research and Foreign Trade Committee. He also serves as a judge on the labor court in Saarbruecken,
Germany. Mr. Sonnekalb received a degree in Business Administration from the University of Fulda, Germany, in 1997.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Continuing Directors</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following is a description
of the incumbent Class I and Class III directors whose terms of office will continue after the Annual Meeting:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Class I </B>&ndash; <B>Directors
Continuing in Office Until the 2026 Annual Meeting</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Dirk Hermann, Ph.D</B>.
Dr. Hermann was appointed to the Board of Directors on April 1, 2020. Dr. Hermann previously served as a member of the Company&rsquo;s
Board of Directors from January 2003 until August 2010. Dr. Hermann currently serves as chief executive officer of Saarland Feuerversicherung
AG, a German insurance company. He joined Versicherungskammer Bayern in 2012, parent company of Saarland Insurance Group. Prior thereto,
he held a variety of positions with Allianz Versicherungen AG, including a tenure as a member of the management board. Dr. Hermann currently
also serves on the board of two German banks, Landesbank Saar and Sparkassenverband, and on the board the Consal Insurance Group. Dr.
Hermann graduated from the University of Konstanz in Germany with a bachelor&rsquo;s degree in business administration. He also holds
a master&rsquo;s degree in business administration from the University of St. Gallen in Switzerland. He earned a Ph.D. degree in business
administration from the University of Leipzig, in Germany.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Class III </B>&ndash; <B>Directors
Continuing in Office Until the 2025 Annual Meeting</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Roland W. Kohl</B>. Mr.
Kohl was the founder of the Company and has been its Chief Executive Officer since its inception in 1990. He has been a Director of the
Company since March 1, 1995. He has overall responsibility for the day-to-day operations of the Company and its subsidiaries. Prior to
forming the Company, Mr. Kohl was the Managing Director of Dialbright Company Limited, a camera manufacturer located in China. Mr. Kohl
received a degree in mechanical engineering and has over thirty years&rsquo; experience in managing factories and manufacturing operations
in China. Mr. Kohl is a German national and resides in Hong Kong.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Tiko Aharonov</B>. Mr.
Aharonov has been a Director of the Company since its inception in 1990 and was a General Manager of the Company&rsquo;s former camera
operations from 1998 to 2004. Until the closing of the Company&rsquo;s Bulgarian facility in 2004, Mr. Aharonov acted as the General Manager
of the Bulgarian operations. He was a bank manager for a leading Israeli commercial and retail bank from 1969 to 1989 and has operated
his own real estate and investment company for high net worth individuals desiring to invest in real estate in Israel. Mr. Aharonov also
represents investors in real estate in Bulgaria.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Irene Wong Ping Yim. </B>
Ms. Wong was elected to the Board of Directors in July 2005. For over ten years, Ms. Wong was the Chief Accountant of CNIM Hong Kong Ltd.
From 1994 to 2001, she was the Accounting Manager of Highway Holdings. Ms. Wong graduated from Deakin University with a Master&rsquo;s
Degree in Business Administration. She is currently a fellow member of the Association of Chartered Certified Accountant and a member
of Hong Kong Institute of Certified Public Accountants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Executive Officers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition to the directors
listed above, the following are the other principal members of the Company&rsquo;s management team.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Alan Chan. </B>Mr. Chan
was appointed as the Company&rsquo;s Chief Financial Officer and Secretary in September 2010. From June 2009 until he joined the Company,
Mr. Chan served as chief financial officer for a joint venture in China with Laureate Education Group. He previously served as vice president
and chief financial officer for DeCoro, an Italian sofa manufacturer with two facilities in Shenzhen, and as financial controller for
San Miguel Shunde Brewery Co. Ltd., a foreign joint venture engaged in the manufacturing and sale of beer products for China and overseas
markets. He also served as financial controller for Hua Yang Printing Holdings Co. Ltd., a manufacturer of children&rsquo;s paper products.
Mr. Chan began his professional career as an accountant with Nelson Wheeler, an Australian CPA firm, and subsequently with PricewaterhouseCoopers
&ndash; formerly Coopers and Lybrand. Mr. Chan earned a Master of Arts degree in accounting from Curtin University in Australia and a
Bachelor of Arts degree from the University of Lancaster in the United Kingdom.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Ringo Tsang</B>. Mr. Tsang
was appointed as the Chief Operating Officer in November 2017. Mr. Tsang joined the Company in March 2009 as a Production Engineer and
was promoted to Chief Technology Officer in 2010. Since becoming Chief Technology Officer, Mr. Tsang has been in charge of the Company&rsquo;s
engineering department, its tool shop, its Computer Numerical Control (CNC) tooling system, and its automation and information technologies.
Mr. Tsang has a Bachelor of Science degree in mechanical engineering, and a Master&rsquo;s Degree in each of Business Administration,
Information Systems, and Professional Accounting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Officers are elected by and
serve at the discretion of the Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Dr. Hermann is the brother-in-law
of Roland Kohl, the Chairman, President and Chief Executive Officer of the Company. Other than Mr. Hermann&rsquo;s relationship with Mr.
Kohl, there are no other family relationships between any of the above-named officers, directors or employees. To the Company&rsquo;s
knowledge, no arrangement or understanding exists between any such director and executive officer and any major shareholder, customer,
supplier or other party pursuant to which any director or executive officer was elected as a director or executive officer of the Company.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Board and Committee Meetings</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors held
four meetings during the fiscal year ended March 31, 2024. Each director attended all of the meetings of the Board of Directors and all
of the meetings of all Board committees on which he or she served that were held during the portion of the 2024 fiscal year in which he
or she served as a director or served on such committees, as applicable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors has
two standing committees: (i) an Audit Committee, and (ii) a Compensation Committee.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Audit Committee</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During fiscal 2024, the members
of the Audit Committee of the Board of Directors were Irene Wong Ping Yim, Heiko Sonnekalb, and Tiko Aharonov. The Audit Committee reviews,
acts on and reports to the Board of Directors on various auditing and accounting matters, including the selection of the Company&rsquo;s
auditors, the scope of the annual audits, fees to be paid to the auditors, the performance of the independent auditors, any additional
services to be provided by the auditors, and the Company&rsquo;s accounting practices. Each of these individuals is a non-employee director
and is independent as defined under the Nasdaq Stock Market&rsquo;s listing standards, and each has significant knowledge of financial
matters (one of the members has an advanced degree in business administration). Ms. Wong has been designated by the Board as the &ldquo;audit
committee financial expert&rdquo; as defined under Item 401(h)(2) of Regulation S-K of the Securities Exchange Act of 1934, as amended.
The Audit Committee met three times during fiscal 2024. The Audit Committee operates under a formal charter that governs its duties and
conduct. This formal charter is available from the Company upon request.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Audit Committee Report</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following is the
report of our Audit Committee with respect to our audited financial statements for the fiscal year ended March 31, 2024. This report shall
not be deemed soliciting material or to be filed with the Securities and Exchange Commission or subject to Regulation&nbsp;14A or 14C
under the Securities Exchange Act or to the liabilities of Section 18 of the Securities Exchange Act, nor shall any information in this
report be incorporated by reference into any past or future filing under the Securities Act or the Securities Exchange Act, except to
the extent we specifically request that it be treated as soliciting material or specifically incorporate it by reference into a filing
under the Securities Act or the Securities Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In performing its oversight
responsibilities as defined in its charter, the Audit Committee has reviewed and discussed the audited financial statements and reporting
process, including the system of internal controls, with management and with ARK Pro CPA &amp; Co., the Company&rsquo;s independent registered
public accounting firm for the year ended March 31, 2024. The Audit Committee has also discussed with ARK Pro CPA &amp; Co. the matters
required to be discussed by the statement on Auditing Standards No. 16, as adopted by the Public Company Accounting Oversight Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, the Audit Committee
has received from ARK Pro CPA &amp; Co. the written disclosures and the letter required by applicable requirements of the Public Company
Accounting Oversight Board regarding ARK Pro CPA &amp; Co.&rsquo;s communications with the Audit Committee concerning independence and
has discussed with ARK Pro CPA &amp; Co. their independence.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based on these reviews and
discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Annual
Report on Form 20-F for the year ended March 31, 2024 for filing with the SEC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 50%"><U>Audit Committee</U></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>Irene Wong Ping Yim</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>Heiko Sonnekalb</TD></TR>
  <TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>Tiko Aharonov</TD></TR>
  </TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Compensation Committee</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the past fiscal year,
the Compensation Committee of the Board of Directors consisted of Tiko Aharonov, Irene Wong Ping Yim and Heiko Sonnekalb. The Compensation
Committee administers the 2020 Option Plan and establishes the salaries and incentive compensation of the executive officers of the Company.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Nominations</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors does
not have a separate Nominating Committee. Nominees for the election to the Board are selected and nominated by the independent directors
(there currently are five directors, three of whom are independent). Accordingly, the Board of Directors has not yet found it necessary
to have a separate Nominating Committee. Assuming that the Class II nominee is elected at the Annual Meeting, three of the five members
of the Board will be independent directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors has
not established any specific minimum qualifications for director candidates or any specific qualities or skills that a candidate must
possess in order to be considered qualified to be nominated as a director. Qualifications for consideration as a director nominee may
vary according to the particular areas of expertise being sought as a complement to the existing board composition. In making its nominations,
the Board of Directors generally will consider, among other things, an individual&rsquo;s business experience, industry experience, financial
background, breadth of knowledge about issues affecting our Company, time available for meetings and consultation regarding Company matters
and other particular skills and experience possessed by the individual. The Board of Directors has not adopted a formal policy with regard
to the consideration of diversity when evaluating candidates for election to the Board of Directors. However, the Board of Directors believes
that membership should reflect diversity in its broadest sense, but should not be chosen nor excluded based on race, color, gender, national
origin or sexual orientation. In this context, the Board of Directors does consider a candidate&rsquo;s experience, education, industry
knowledge, history with the Company, and differences of viewpoint when evaluating his or her qualifications for election the Board. In
evaluating such candidates, the Board of Directors seeks to achieve a balance of knowledge, experience and capability in its composition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To date, all nominees for
election to the Board were recommended for nomination by our existing independent directors, and our current nominee was recommended by
our existing independent directors. The Company does not have any policy with regard to the consideration of any director candidates recommended
by securityholders. All potential director candidates, regardless of source, are reviewed under the same process. The Board of Directors
believes this approach is appropriate in light of the infrequent occurrence of recommendations made by our shareholders. Notwithstanding
the foregoing, under the Company&rsquo;s Amended and Restated Memorandum and of Articles of Association, no person shall be eligible for
election as a director of the Company if the election of such person as a director would cause the Company to be ineligible to remain
a &ldquo;foreign private issuer.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A shareholder may nominate
one or more persons for election to the Board of Directors. In order for such nomination to be considered, the shareholder must (i) provide
timely notice thereof in writing and in proper form to the secretary of the Company and (ii) provide the information required by Regulation
7.6 of the Company&rsquo;s Amended and Restated Articles of Association. To be timely, a shareholder&rsquo;s notice must be delivered
to, or mailed and received at, the principal executive offices of the Company not less than ninety (90) days nor more than one hundred
twenty (120) days prior to the first anniversary of the preceding year&rsquo;s meeting at which members of the Board of Directors were
elected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We do not have a formal policy
regarding attendance by Board members at the Annual Meeting of Shareholders. Our Chairman and Chief Executive Officer will attend our
2024 Annual Meeting. However, because most of the directors are located outside of the U.S., none of the other directors is expected to
attend the Annual Meeting.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Board Leadership Structure and Role in Risk Oversight</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors believes
it is important to select the Company&rsquo;s Chairman and Chief Executive Officer in the manner it considers in the best interests of
the Company at any given time. Accordingly, the Chairman and Chief Executive Officer positions may be filled by one individual or by two
different individuals, as determined by the Board of Directors based on circumstances then in existence.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Currently, Roland Kohl serves
as both Chairman and Chief Executive Officer. The Board of Directors considers this leadership structure to be suitable for the Company
because it allows one person to lead and represent the Company and the Board of Directors, while also providing for effective oversight
by an independent Board. The Board of Directors believes that having Mr. Kohl serve in the roles of Chairman and Chief Executive Officer
is appropriate for the Company and its shareholders at this time, in view of Mr. Kohl&rsquo;s continuous long-standing roles in such positions,
and Mr. Kohl&rsquo;s in-depth knowledge of the Company&rsquo;s business and industry. The Board of Directors also believes that the number
of its independent directors mitigates the risk of any potential conflicts that might result from combining the roles of Chief Executive
Officer and Chairman.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Tiko Aharonov has been designated
as the &ldquo;lead independent director&rdquo; of the Board of Directors. Mr. Aharonov is responsible for coordinating the activities
of the independent directors, working with the Chief Executive Officer to set the agenda for Board meetings, chairing executive sessions
of the independent directors, and leading the Board&rsquo;s review of the Chief Executive Officer. The Board of Directors is currently
comprised of a majority of individuals who are independent from the management of the Company and, assuming that the nominee is elected
at the Annual Meeting, three of the future five members of the Board will continue to be independent directors. The Board of Directors
and its committees meet regularly throughout the year to assure that the independent directors are well briefed and informed with regard
to the Company&rsquo;s affairs. Each of the independent directors has unfettered access to any employee within the Company and each director
is encouraged to call upon whatever employee he deems fit to secure the information each director feels is important to his understanding
of our Company. In this fashion, the Board seeks to maintain well informed, independent directors who are prepared to make informed decisions
regarding the Company&rsquo;s business affairs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Management is responsible
for the day-to-day management of risks the Company faces, while the Board of Directors as a whole plays an important role in overseeing
the identification, assessment and mitigation of such risks. The Board of Directors reviews information regarding the Company&rsquo;s
finances and operations, as well as the risks associated with each. For example, the oversight of financial risk management lies primarily
with the Board&rsquo;s Audit Committee, which is empowered to appoint and oversee our independent auditors, monitor the integrity of our
financial reporting processes and systems of internal controls and provide an avenue of communication among our independent auditors,
management and the Board of Directors. The Company&rsquo;s Compensation Committee is responsible for overseeing the management of risks
relating to the Company&rsquo;s compensation plans and arrangements, as well as risks associated with the independence of the Board of
Directors and potential conflicts of interest. In fulfilling its risk oversight responsibility, the Board of Directors, as a whole and
acting through any established committees, regularly consults with management to evaluate and, when appropriate, modify our risk management
strategies.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PROPOSAL II - RATIFICATION OF INDEPENDENT
PUBLIC ACCOUNTANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Audit Committee of the
Board has selected ARK Pro CPA &amp; Co (&ldquo;ARK&rdquo;), an accounting firm based in Hong Kong, to continue as the Company&rsquo;s
independent registered public accounting firm for the fiscal year ended March 31, 2025. During the Company&rsquo;s fiscal year ended March
31, 2024, ARK served as our independent registered public accounting firm.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Shareholder ratification of
the selection of ARK as the Company&rsquo;s independent public accountants is not required by the Company&rsquo;s Amended and Restated
Memorandum and Articles of Association or otherwise. However, the Board of Directors is submitting the anticipated selection of ARK to
the shareholders for ratification as a matter of good corporate practice. The Board of Directors will consider the shareholders&rsquo;
vote in its determination of whether to retain that firm. However, even if the selection is ratified, the Board of Directors in its discretion
may direct the selection of a different independent accounting firm or change such selection at any time during the year if it determines
that such a change would be in the best interests of the Company and its shareholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors does
not anticipate a representative of ARK will attend the Annual Meeting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table presents the aggregate fees
for professional services and other services rendered by ARK to the Company for the periods indicated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
  <TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2023</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2024</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">Audit Fees (1) - ARK Pro CPA &amp; Co.</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">205,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">220,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other Fees</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Tax Fees (2)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt">Total</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">205,000</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">220,000</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
  </TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Rule-Page --><DIV STYLE="margin-top: 0pt; margin-bottom: 0pt; width: 25%"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>








<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(1)</TD><TD STYLE="text-align: justify">Audit fees represent fees for professional services provided
in connection with the audit of the Company&rsquo;s consolidated financial statements, and audit services provided in connection with
other statutory or regulatory filings.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(2)</TD><TD STYLE="text-align: justify">Tax Fees include fees for the preparation of tax returns.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As part of its policies and
procedures, all audit related services, tax services and other services, if any, rendered by our independent registered public accounting
firms were pre-approved by the Audit Committee.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="break-before: page; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PROPOSAL III - APPROVAL OF AN AMENDMENT TO
THE 2020 OPTION PLAN</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At the annual meeting held on October 8, 2020,
the shareholders of the Company adopted the 2020 Option Plan to replace the prior 2010 Stock Option and Restricted Stock Plan (the &ldquo;2010
Option Plan&rdquo;) that expired on June 26, 2020. On the date that the 2010 Option Plan expired, awards for all 600,000 shares available
for grant under the 2010 Option Plan had been granted, and no additional shares were available for grant under the 2010 Option Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 17, 2022, our Board of Directors unanimously
approved an amendment to the 2020 Option Plan that increases the aggregate number of shares of Common Shares that may be issued pursuant
to stock awards granted under the 2020 Option Plan from 500,000 shares to 1,000,000 shares. We refer to this amendment as the &ldquo;Plan
Amendment.&rdquo; The Plan Amendment approved by our Board of Directors is subject to the approval of our shareholders at the Annual Meeting.
If our shareholders do not approve the Plan Amendment, the number of shares of Common Shares that may be issued pursuant to stock awards
granted under the 2020 Option Plan will remain at 500,000 shares. Our Board of Directors unanimously recommends that shareholders approve
the Plan Amendment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">No other amendments to the 2020 Option Plan are
being proposed by our Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">A copy of the 2020 Option Plan, as amended by the
Plan Amendment increasing the number of shares that may be issued under the 2020 Option Plan from 500,000 shares to 1,000,000 shares,
is attached as Appendix A to this Proxy Statement and is incorporated herein by reference. We urge stockholders to read the 2020 Option
Plan, as amended by the Plan Amendment, in its entirety.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Why We Are Asking Our Shareholders to Approve the Plan Amendment</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We maintain the 2020 Option Plan to grant stock
options and restricted stock in order to provide long-term incentives to our employees, directors and consultants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Approval of the Plan Amendment by our shareholders
will allow us to continue to grant stock options and restricted stock determined to be appropriate by our Board of Directors or Compensation
Committee. The 2020 Option Plan, as amended by the Plan Amendment, will also allow us to continue to use a varied array of equity incentives
in order to secure and retain the services of our employees, directors and consultants and to align their interests with the interests
of our stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">No more shares of Common Shares are available for
new awards under either the 2010 Option Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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    <DIV STYLE="break-before: page; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Requested Shares</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If the Plan Amendment is approved by our shareholders,
the additional number of shares of Common Shares available for issuance will be 500,000 shares, which represents approximately 11.36%
of the shares of our fully-diluted Common Shares outstanding as of July 31, 2024. Based on historic grant practices, our Board of Directors
estimates that these additional 500,000 shares, when added to the 200,000 shares that currently remain available for new awards under
the 2020 Option Plan, should be sufficient to enable us to grant equity awards to our employees, directors and consultants for approximately
five more years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Equity Compensation Plan Information</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table provides
information, as of March 31, 2024, with respect to all of our compensation plans under which equity securities are authorized for issuance:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.125in; padding-left: 0.125in; border: Black 1pt solid; width: 34%">
    <P STYLE="text-indent: -0.25in; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-align: center">&nbsp;</P>
    <P STYLE="text-indent: -0.25in; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-align: center">&nbsp;</P></TD>
    <TD STYLE="border-top: Black 1pt solid; width: 22%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">Number of Shares to be Issued Upon Exercise of Outstanding Options, Warrants and Rights</TD>
    <TD STYLE="border-top: Black 1pt solid; width: 22%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights</TD>
    <TD STYLE="border-top: Black 1pt solid; width: 22%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">Number of Shares Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Shares Reflected in Column&nbsp;(a))</TD></TR>
  <TR>
    <TD STYLE="text-indent: -0.125in; padding-left: 0.125in; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">(a)</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">(b)</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center">(c)</TD></TR>
  <TR>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; text-indent: -0.125in; padding-left: 0.15in; vertical-align: top; font-style: italic"><FONT STYLE="font-style: normal">Equity compensation plans approved by our shareholders: </FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center">195,000</TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center">$1.97</TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center">200,000</TD></TR>
  <TR>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; text-indent: -0.125in; padding-left: 0.15in; vertical-align: top; font-weight: bold"><FONT STYLE="font-weight: normal">Equity compensation plans not approved by our shareholders</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center">-0-</TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><B>--</B></TD>
    <TD STYLE="border-right: Black 1pt solid; vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><B>--</B></TD></TR>
  </TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To date, no options have been
granted under the 2020 Option Plan. However, the Company has 300,000 shares of restricted stock to Mr. Kohl.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Summary of the 2020 Option Plan, as Amended
by the Plan Amendment</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The summary of the principal
features of the 2020 Option Plan, as amended by the Plan Amendment, that is set forth below is not a complete description of the 2020
Option Plan and is qualified by the full text of the 2020 Option Plan that is attached as Appendix A to this Proxy Statement.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">General</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The 2020 Option Plan provides
for awards of stock options (&ldquo;Options&rdquo;) and rights to acquire restricted shares (&ldquo;Restricted Shares&rdquo;). The Board
of Directors adopted the 2020 Option Plan to attract and retain effective and capable directors, officers, employees and individual consultants
of the Company and its subsidiaries; to provide incentive compensation opportunities that are competitive with other similar businesses;
to bind the interests of these directors, officers, employees and individuals more closely to the Company&rsquo;s own interests by offering
them opportunities to acquire Common Shares; and thereby provide these individuals with added incentive to remain in the service of the
Company and its subsidiaries and to enhance long-term shareholder returns. We currently have approximately 150 employees, directors and
consultants that are eligible to participate in the 2020 Option Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Administration</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Unless it delegates administration
to a committee as described below, the Board of Directors will administer the 2020 Option Plan. Subject to the provisions of the 2020
Option Plan, the Board of Directors has the power to construe and interpret the 2020 Option Plan and to determine the persons to whom
and the dates on which awards will be granted, the number of Common Shares to be subject to each award, the time or times during the term
of each award within which all or a portion of such award may be exercised, the exercise price or purchase price of each award, the types
of consideration permitted to exercise or purchase each award and other terms of the awards.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Under the 2020 Option Plan,
the Board of Directors has the power to delegate administration of the 2020 Option Plan to a committee composed of one or more directors.
In the discretion of the Board of Directors, a committee may consist solely of two or more &ldquo;Non-Employee Directors&rdquo; (as such
terms are defined in the 2020 Option Plan). Within the scope of such authority, the Board of Directors or the committee may delegate to
one or more directors who are not Non-Employee Directors the authority to grant awards to eligible persons who would not then subject
to Section 16 of the Exchange Act of 1034, as amended. The Board of Directors may also delegate nondiscretionary administrative duties
to such employees of the Company as it deems proper.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors has
plenary authority in its discretion to administer the 2020 Option Plan, including, but not limited to the power to interpret, implement
and apply the provisions of the 2020 Option Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Stock Subject to the 2020 Option Plan</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Subject to the provisions
of subsection 6(b) of the 2020 Option Plan relating to adjustments upon changes in Common Shares, an aggregate of 1,000,000 Common Shares
will be set aside and reserved for issuance under the 2020 Option Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If awards granted under the
2020 Option Plan expire or otherwise terminate without being exercised in full, the Common Shares not acquired pursuant to such awards
will again become available for issuance under the 2020 Option Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If Common Shares subject to
an award are not delivered to a participant because such shares are withheld for payment of taxes incurred in connection with the exercise
of an option, or the award is exercised through a reduction of shares subject to the award (&ldquo;net exercised&rdquo;), then the number
of shares that are withheld shall no longer be available for issuance under the 2020 Option Plan. In addition, if the exercise price of
any award is satisfied by the tender of Common Shares to us (whether by actual delivery or attestation), then the shares tendered will
no longer be available for issuance under the 2020 Option Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Eligibility</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(a) Participation
in the 2020 Option Plan shall be limited to the directors, executives and employees of the Company and its subsidiaries, and any consultant
or other individual providing services to the Company or a subsidiary, provided that a consultant shall not be eligible for the grant
of an award if, at the time of grant, a Form S-8 Registration Statement under the Securities Act (&ldquo;Form S-8&rdquo;) is not available
to register either the offer or the sale of the Company&rsquo;s securities to such consultant, unless the Company determines that such
grant otherwise complies with the requirements of the Securities Act and the securities laws of all other relevant jurisdictions.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Terms of Options</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Options shall be granted under
the 2020 Option Plan pursuant to stock option agreements. The following is a description of the permissible terms of Options under the
2020 Option Plan. Individual Option grants may be more restrictive as to any or all of the permissible terms described below.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Exercise Price; Payment</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The exercise price per share
for Options shall be established by the Board of Directors at the time of the grant of Options pursuant to the 2020 Option Plan, provided
that the exercise price for Options granted to participants subject to taxation in the United States shall not be less than the &ldquo;fair
market value&rdquo; (as defined in the 2020 Option Plan) of the Common Shares subject to the Option on the date of the grant. The exercise
price of Options granted to participants who are not subject to taxation in the United States may be less than the fair market value of
the Common Shares on the date of grant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The exercise price of Options
granted under the 2020 Option Plan must be paid either: (i) in cash at the time the Option is exercised, (ii) by delivery of other of
our Common Shares, or (iii) pursuant to a net exercise arrangement. Notwithstanding the foregoing provisions, the Board of Directors,
in granting Options pursuant to the 2020 Option Plan, may limit the methods in which an Option may be exercised by a participant and,
in processing any purported exercise of an Option granted pursuant to the 2020 Option Plan, may refuse to recognize the method of exercise
selected by the Option holder (other than payment in cash).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">An Option holder shall have
none of the rights of a shareholder of the Company until the Common Shares covered by the Option are issued to him upon exercise of the
Option.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Vesting</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors may
provide in the option agreement that the right to exercise each Option for the number of shares subject to each Option shall vest in the
Option holder over such period of time, or upon the occurrence of such event, contingency or condition (which may be based on performance
or other criteria), as the Board, in its discretion, shall determine for each Option holder. The vesting provisions of individual Options
may vary.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Term</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The term of each Option shall
be determined by the Board of Directors at the time of grant of the Option, provided that if no term is established by the Board of Directors,
the term of the Option shall be five years from the date on which it is granted. Options awarded under the 2020 Option Plan generally
will terminate effective at the close of business on the date the Option holder ceases to be an active, regular employee of the Company
or any of its subsidiaries, except: (i) in the event an employee Option holder takes a leave of absence from, or ceases providing services
to, the Company or any of its subsidiaries for personal reasons, by reason of illness, disability, voluntary termination with the consent
of the Board of Directors, or other special circumstances, the Board of Directors may consider his case and may take such action in respect
of the related option agreement as it may deem appropriate under the circumstances; (ii) if an Option holder dies during the term of his
Option without having fully exercised his Option, the executor or administrator of his estate or the person who inherits the right to
exercise the Option by bequest or inheritance shall have the right at any time following the Option holder&rsquo;s death to purchase the
number of shares of Common Shares that the deceased Option holder was entitled to purchase at the date of his death; and (iii) if an Option
holder terminates employment without his having fully exercised his Option due to his retirement with the consent of the Company, then
such Option holder shall have the right within 90 days of the Option holder&rsquo;s termination of employment to purchase the number of
Common Shares that the Option holder was entitled to purchase at the date of his termination.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On receipt of written notice
of exercise, the Board of Directors may elect to cash out all or part of the portion of any Option to be exercised by paying the participant
an amount, in cash or Common Shares, equal to the excess of the &ldquo;fair market value&rdquo; (as defined in the 2020 Option Plan) of
the Common Shares that is subject to the Option over the exercise price times the number of Common Shares subject to the Option on the
effective date of such cash-out.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Restrictions on Transfer</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Options shall be nontransferable
and nonassignable, except that Options may be transferred by testamentary instrument or by the laws of descent and distribution. Notwithstanding
the foregoing, the Board of Directors may set forth in the option agreement at the time of grant or thereafter, that the Option may be
transferred to members of the optionee&rsquo;s immediate family, to trusts solely for the benefit of such immediate family members, and
to partnerships in which such family members and/or trusts are the only partners. For this purpose, immediate family means the optionee&rsquo;s
spouse, parents, children, stepchildren, grandchildren, and legal dependents. In the event an Option is transferred in accordance with
the foregoing, the Option shall be exercisable solely by the transferee and shall remain subject to the provisions of the 2020 Option
Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Terms of Restricted Share Awards</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Restricted share awards shall
be granted under the 2020 Option Plan pursuant to restricted share agreements.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Payment</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Restricted Shares may be granted
under the 2020 Option Plan for such consideration (including cash, cash equivalents, full-recourse promissory notes, past services and
future services) and such other terms, conditions and restrictions as determined by the Board of Directors.</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Vesting</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Restricted Shares acquired
under a restricted share purchase or grant agreement may, but need not, be subject to forfeiture to the Company or other restrictions
that will lapse in accordance with a vesting schedule to be determined by the Board of Directors. During any restricted period, the recipient
shall not be permitted to sell, transfer, pledge or assign Restricted Shares awarded under the 2020 Option Plan. In the event a recipient&rsquo;s
employment or service with the Company terminates, any or all of the Common Shares held by such recipient that have not vested as of the
date of termination under the terms of the restricted share agreement may be forfeited to the Company in accordance with such restricted
share agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The holders of Restricted
Shares awarded under the 2020 Option Plan shall have the same voting, dividend and other rights as the Company&rsquo;s other shareholders.
A restricted share agreement, however, may require that the holders of Restricted Shares invest any cash dividends received in additional
Restricted Shares.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Tax Withholding</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">All awards under the 2020
Option Plan are subject to withholding of all applicable taxes, and the Board of Directors may condition the delivery of any shares or
other benefits under the 2020 Option Plan on satisfaction of the applicable withholding obligations. The Board of Directors, in its discretion,
may permit such withholding obligation to be satisfied through cash payments, through the surrender of Common Shares that the participant
already owns, or through the surrender of Common Shares to which the participant is otherwise entitled under the 2020 Option Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Adjustment Provisions</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If any change is made to the
outstanding Common Shares by reason of reorganization, recapitalization, stock split, stock dividend, combination of shares of Common
Shares, merger, consolidation, share exchange, acquisition of property or stock, or any change in the capital structure of the Company,
the 2020 Option Plan will be appropriately adjusted in the class and maximum number of shares of Common Shares subject to the 2020 Option
Plan, and outstanding awards will be adjusted in the class, number of shares and price per share of Common Shares subject to such awards.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Effect of Certain Corporate Events</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Unless otherwise provided
in the grant agreement, in the event of a &ldquo;change in control&rdquo; (as defined in the 2020 Option Plan) any awards outstanding
as of the date of such change in control and not then exercisable shall become fully exercisable to the full extent of the original grant.
Notwithstanding the foregoing or any terms of a grant agreement to the contrary, the Board of Directors shall have full discretion to
do any or all of the following with respect to an outstanding award under the 2020 Option Plan: (i) to cause any award to be canceled,
provided notice is provided at least 15 days in advance; (ii) to provide that the securities of another entity be substituted for the
Common Shares and to make equitable adjustment with respect thereto; (iii) to grant the participant the right, by giving notice during
a pre-set period to surrender all or part of an Option to the Company, to receive cash in an amount equal to the amount by which the price
per share of Common Shares, if any, paid in any corporate transaction that gave rise to the change in control shall exceed the amount
which the participant must pay to exercise the Option per share under the Option multiplied by the number of Common Shares granted under
the Option; (iv) to require the assumption of the obligation of the Company under the 2020 Option Plan subject to appropriate adjustment;
or (v) to take any other action determines to take.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Limitation on Liability</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To the maximum extent permitted
by law, no member of the Board of Directors shall be liable for any action or determination made with respect to the 2020 Option Plan.
In addition to such other rights of indemnification that they may have, the members of the Board of Directors shall be indemnified by
the Company to the maximum extent permitted by law against any and all liabilities and expenses incurred in connection with their service
in such capacity.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Duration, Amendment and Termination</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors may
suspend or terminate the 2020 Option Plan without shareholder approval or ratification at any time or from time to time. Unless sooner
terminated, the 2020 Option Plan will terminate on June 19, 2030, the day before the tenth anniversary of the date the 2020 Option Plan
was adopted by the Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors at
any time may amend the 2020 Option Plan; provided, however, that any award granted before amendment of the 2020 Option Plan shall not
be impaired by any amendment of the 2020 Option Plan, except with the written consent of the holder of the award. Except as provided in
paragraph&nbsp;6(b) of the 2020 Option Plan (relating to adjustments upon changes in Common Shares), no amendment shall be effective unless
approved by the shareholders of the Company to the extent shareholder approval is necessary to satisfy the requirements of Rule&nbsp;16b-3
of the Securities Exchange Act of 1934, as amended, or any securities exchange listing requirements applicable to the Company. The Board
of Directors may, in its sole discretion, submit any other amendment to the 2020 Option Plan for shareholder approval.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Plan Benefits</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">No employee, director or consultant
has yet been selected to receive any award under the 2020 Option Plan and no term or condition of any such award has been determined.
Each of our directors and executive officers are eligible to receive awards under the 2020 Option Plan and as such, may be deemed to have
an interest in the approval of the 2020 Option Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Security Ownership of Certain Beneficial Owners and Management</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table sets forth,
as of August 19, 2024, the record date, certain information with respect to the beneficial ownership of the Company&rsquo;s Common Shares
by (i) each person known by the Company to own beneficially more than 5% of the outstanding Common Shares outstanding as of such date,
(ii) each of the director nominees, (iii) executive officers, and (iv) the officers and directors of the Company as a group.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: center"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Name of Beneficial Owner or Identity of Group<SUP>(1)</SUP></P></TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1.5pt solid; text-align: center">Number of <BR>
Common <BR>
Shares <BR>
Beneficially <BR>
Owned</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1.5pt solid; text-align: center">Percent<BR>
Beneficial<BR>
Owned<SUP>(**)</SUP></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">Roland W. Kohl&#9;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">974,067</TD><TD STYLE="width: 1%; text-align: left"> (2)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">22.1</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Tiko Aharonov&#9;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">285,000</TD><TD STYLE="text-align: left"> (3)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.5</TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Heiko Sonnekalb&#9;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">*</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Dirk Hermann&#9;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">51,286</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.2</TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Irene Wong Ping Yim&#9;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">43,000</TD><TD STYLE="text-align: left"> (4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.0</TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Alan Chan&#9;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">50,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.1</TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Ringo Tsang&#9; </TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">50,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.1</TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">All Directors and Officers as a Group (7 Persons)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">1,483,353</P></TD><TD STYLE="text-align: left">(5)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">33.7</P></TD><TD STYLE="text-align: left">%</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-decoration: underline; text-align: left">Greater than 5% shareholders</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Peter J. Abrahamson</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">368,900</TD><TD STYLE="text-align: left">(6)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.4</TD><TD STYLE="text-align: left">%</TD></TR>
  </TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<!-- Field: Rule-Page --><DIV STYLE="margin-top: 0pt; margin-bottom: 0pt; width: 25%"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">*</TD><TD STYLE="text-align: justify">Less than 1%.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">**</TD><TD STYLE="text-align: justify">Under the rules of the Securities and Exchange Commission,
shares of Common Shares that an individual or group has a right to acquire within 60 days pursuant to the exercise of options or warrants
are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to
be outstanding for the purpose of computing the percentage ownership of any other person shown in the table.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(1)</TD><TD STYLE="text-align: justify">The address of each of the named holders is c/o Highway Holdings
Limited, Suite 1801, Level 18, Landmark North, 39 Lung Sum Avenue, Sheung Shui, New Territories, Hong Kong.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(2)</TD><TD STYLE="text-align: justify">Includes currently exercisable options to purchase 10,000
shares.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(3)</TD><TD STYLE="text-align: justify">Includes currently exercisable options to purchase 50,000
shares.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(4)</TD><TD STYLE="text-align: justify">Includes currently exercisable options to purchase 40,000
shares.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(5)</TD><TD STYLE="text-align: justify">Includes currently exercisable options to purchase 100,000
shares.</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left">(6)</TD><TD STYLE="text-align: justify">Based on a Schedule 13G/A filed with the SEC by Peter J.
Abrahamson on February 2, 2024.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There are no arrangements
known to the Company the operation of which may at a subsequent date result in a change in control of the Company. All holders of the
Common Shares have the same voting rights.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Compensation of Directors and Officers</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The aggregate amount of compensation
(including non-cash benefits, but excluding equity compensation) paid by the Company and its subsidiaries during the year ended on March
31, 2024 to directors on the Company&rsquo;s Board of Directors and officers as a group (ten people, including directors who have resigned),
for services rendered to the Company and its subsidiaries in all capacities was approximately $708,000, excluding amounts paid by the
Company as dividends to directors and executive officers in their capacity as shareholders of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Mr. Kohl is employed pursuant
to an employment agreement that can only be terminated by the Company, other than for cause or in the case of Mr. Kohl&rsquo;s incapacity,
by paying Mr. Kohl a severance payment equal to three times his annual base salary. However, since April 2019 under the employment agreement
Mr. Kohl&rsquo;s base salary will be reduced by one-half from his initial base salary following any fiscal quarter in which the Company
has a net quarterly loss, which salary reduction will remain in effect until the Company has net income in any subsequent quarter. Accordingly,
in the event that the Company has a quarterly loss, Mr. Kohl&rsquo;s annual base salary for the following quarter will be reduced by one-half.
The forfeited salary will not be recouped if/when the Company has a profitable fiscal quarter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;Mr. Kohl, and the three
other senior managers of the Company, are entitled to receive cash payments equal to three times their annual salary in the event of
a change of control of the Company without the approval of the Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 13, 2023, Mr. Kohl
was granted 300,000 shares of restricted stock under the Company&rsquo;s 2020 Stock Option and Restricted Stock Plan. The restricted stock
award granted to Mr. Kohl is subject to vesting in tranches upon the Company&rsquo;s achievement of certain strategic transactions within
five years from the date the shares were granted, and any shares not vested by the five-year anniversary of the date of grant or upon
termination of Mr. Kohl&rsquo;s employment with the Company shall be forfeited and reconveyed to the Company. The restricted shares vest
in three (3) tranches, with 100,000 of the shares vesting in two tranches, and all of the unvested shares vesting in one tranche. Each
tranche vests upon completion of a certain milestone by the Company relating to the consummation by the Company or its subsidiaries of
certain strategic transactions within five (5) years from the date of grant. The independent members of the Board shall have the final
determination as to whether the Company has achieved any of the share release milestones.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the past fiscal year,
the Company paid each of the non-executive directors an annual director&rsquo;s fee of $12,000 and reimbursed them for their reasonable
expenses incurred in connection with their services as directors. In addition, the Chairman of any committee is paid an additional fee
of $2,000 per year, and the members of a committee are paid an additional fee of $2,000 per year for each committee on which they serve.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">SHAREHOLDER PROPOSALS AT THE<BR>
NEXT ANNUAL MEETING OF SHAREHOLDERS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Shareholder proposals submitted
for inclusion in the Company&rsquo;s Proxy Statement and form of proxy relating to the Company&rsquo;s 2025 annual meeting of shareholders
must be received by July 14, 2025. If the Company is not notified of a shareholder proposal by July 14, 2025, then the proxies held by
management of the Company may provide the discretion to vote against such shareholder proposal, even though such proposal is not discussed
in the Proxy Statement. Shareholder proposals should be submitted to the Company at Suite 1801, Level 18, Landmark North, 39 Lung Sum
Avenue, Sheung Shui, New Territories, Hong Kong.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">OTHER MATTERS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors does
not know of any other business that may be presented for consideration at the meeting. However, if any matters not referred to in this
Proxy Statement should properly come before the meeting, the persons named in the proxies will vote the shares represented thereby in
accordance with their judgment.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">COMMUNICATIONS WITH THE BOARD OF DIRECTORS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Shareholders may communicate
directly with the Board of Directors by writing to them at Board of Directors, c/o Secretary, Highway Holdings Limited, Suite 1801, Level
18, Landmark North, 39 Lung Sum Avenue, Sheung Shui, New Territories, Hong Kong. Such communications will be forwarded to the director
or directors to whom it is addressed, except for communications that are (1) advertisements or promotional communications, (2) solely
related to complaints with respect to ordinary course of business customer service and satisfaction issues, or (3) clearly unrelated to
the Company&rsquo;s business, industry, management or Board or committee matters.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="break-before: page; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AVAILABILITY OF ANNUAL REPORT ON FORM 20-F</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company will furnish without
charge a copy of the Company&rsquo;s Annual Report on Form 20-F for the fiscal year ended March 31, 2024 as filed with the Securities
and Exchange Commission to any shareholder desiring a copy. Shareholders may request such Annual Reports from the following: David Pasquale,
Global IR Partners by email at dpasquale@globalirpartners.com or by phone at (914) 337-8801.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
    <TD STYLE="width: 60%; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 40%; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By Order of
    the Board of Directors</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">August 29, 2024</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    <B>Alan Chan</B></FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Alan Chan</B>, Secretary</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
  </TABLE>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Appendix A</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">2020 Option Plan</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">[attached]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>APPENDIX A</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>HIGHWAY HOLDINGS LIMITED</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>2020 STOCK OPTION AND RESTRICTED
STOCK PLAN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2pt 0pt 1.1pt; text-align: center"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in"><B>1.</B></TD><TD><B>Purposes</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">The purposes of the Plan are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">(a) To
attract and retain effective and capable directors, officers, employees and individual consultants of the Company and its Subsidiaries
who contribute materially to the success of the Company and its Subsidiaries and to provide incentive compensation opportunities that
are competitive with other similar businesses;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 12.7pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) To
bind the interests of these directors, officers, employees and individuals more closely to the Company&rsquo;s own interests by offering
them opportunities to acquire Common Stock; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">(c) Thereby
provide these individuals with added incentive to remain in the service of the Company and its Subsidiaries and to enhance long-term shareholder
returns.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">2.</TD><TD>Definitions</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">The following terms wherever used
herein shall have the meanings set forth below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: 0in">(a) The term &ldquo;<U>Award</U>&rdquo; shall mean an award of an Option or a
Restricted Share under the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; margin-left: 0.5in; text-indent: 0in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; margin-left: 0.5in; text-indent: 0in; text-align: justify">(b)
The term &ldquo;<U>Board</U>&rdquo; shall mean the Board of Directors of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.5pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">(c) The term
&ldquo;<U>Change in Control of the Company</U>&rdquo; shall mean a change in control of a nature that would be required to be
reported in response to Item 6(e) of Schedule l4A of the Regulation 14A promulgated under the Exchange Act, whether or not the
Company is in fact required to comply therewith, provided that, without limitation, such a change in control shall be deemed to have
occurred if (A) any &ldquo;person&rdquo; (as such term is used in Section 13(d) and 14(d) of the Exchange Act), other than a trustee
or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries or a corporation
owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as the ownership of Common
Stock of the Company, is or becomes the &ldquo;beneficial owner&rdquo; (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 50% or more of the combined voting power of the Company&rsquo;s then
outstanding securities; (B) during any period of two consecutive years (not including any period prior to the adoption of the Plan),
individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a
person who has entered into an agreement with the Company to effect a transaction described in clauses (A) or (D) of this
definition) whose election by the Board or nomination for election by the Company&rsquo;s shareholders was approved by a vote of at
least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to constitute a majority of the Board; (C) the Company
enters into an agreement, the consummation of which would result in the occurrence of a Change in Control of the Company; or (D) the
shareholders of the Company approve a merger, share exchange or consolidation of the Company with any other corporation, other than
a merger, share exchange or consolidation that would result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving
entity) at least 50% of the combined voting power of the voting securities of the Company of such surviving entity outstanding
immediately after such merger, share exchange or consolidation, or the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale of disposition by the Company of all or substantially all the
Company&rsquo;s assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 22pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 22pt 0pt 0pt; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 22pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(d) The
term &ldquo;<U>Committee&rdquo;</U> shall mean a committee of one or more members of the Board appointed by the Board in accordance with
subparagraph 4(i).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 14.7pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(e) The
term &ldquo;<U>Common Stock</U>&rdquo; shall mean the regular voting common shares, $0.01 par value per share, of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 20pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(f) The
term &ldquo;<U>Company</U>&rdquo; shall mean Highway Holdings Limited, a British Virgin Islands company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.4pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(g) The
term &ldquo;<U>Exchange Act</U>&rdquo; shall mean the United States Securities Exchange Act of 1934, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(h) The
term &ldquo;<U>Fair Market Value</U>&rdquo; shall mean (a) the average on the applicable date of the high and low prices of a share of
Common Stock on the principal national securities exchange on which shares of Common Stock are then trading, or, if shares were not traded
on such date, then on the next preceding date on which a trade occurred; or (b) if Common Stock is not traded on a national securities
exchange, the closing bid price (or average bid prices) last quoted on such date by an established quotation service for over-the-counter
securities; or (c) if Common Stock is not traded on a national securities exchange and is not otherwise publicly traded on such date,
the fair market value of a share of Common Stock as established by the Board acting in good faith and taking into consideration all factors
which it deems appropriate, including, without limitation, recent sale or offer prices for the Common Stock in private arm&rsquo;s- length
transactions. During periods when the Fair Market Value cannot be determined under any of the methods specified in clauses (a) and (b),
above, the Committee shall have the authority to establish the Fair Market Value as of the beginning of (or periodically during) each
fiscal year of the Company and to use such value for all transactions occurring thereafter within such fiscal year.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.9pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(i) The
terms &ldquo;<U>Option</U>&rdquo; and &ldquo;<U>Stock Option</U>&rdquo; shall mean a right granted pursuant to the Plan to purchase shares
of Common Stock at an exercise price and on other terms established pursuant to paragraph 7.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(j) The
term &ldquo;<U>Option Agreement</U>&rdquo; shall mean the written agreement representing an Option granted as contemplated by paragraph
7.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(k) The
term &ldquo;<U>Non-Employee Director</U>&rdquo; shall mean a Director who is considered a &ldquo;non-employee director&rdquo; within the
meaning of Rule 16b-3 under the Exchange Act.</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 21.2pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 21.2pt 0pt 0pt; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 21.2pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(l) The
term &ldquo;<U>Plan</U>&rdquo; shall mean the Highway Holdings Limited 2020 Stock Option and Restricted Stock Plan as originally approved
by the Board on June 20, 2020, as the same may be amended from time to time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 11.6pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(m) The
term &ldquo;<U>Restricted Share</U>&rdquo; means a share of Common Stock awarded under the Plan that is subject to a risk of forfeiture
or other restrictions that will lapse upon the achievement of one or more goals relating to completion of service or achievement of performance
or other objectives, as determined by the Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 43.3pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(n) The
term &ldquo;<U>Restricted Share Agreement</U>&rdquo; means the agreement between the Company and the recipient of a Restricted Share that
contains the terms, conditions and restrictions pertaining to such Restricted Share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.2pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(o) The
terms &ldquo;<U>Subsidiary</U>&rdquo; and &ldquo;<U>Subsidiaries</U>&rdquo; shall mean one or more corporations of which capital stock
possessing 50% or more of the total combined voting power of all classes of its capital stock entitled to vote generally in the election
of directors is owned in the aggregate by the Company directly or indirectly through one or more Subsidiaries.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0in; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">3.</TD><TD>Effective Date of the Plan</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">The Plan shall become effective
upon approval of the shareholders of the Company, provided that the Board may grant Options and award Restricted Shares pursuant to the
Plan prior to shareholder approval if the grant of such Options or the award of such Restricted Shares by its terms is contingent upon
subsequent shareholder approval of the Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">4.</TD><TD>Operation and Administration</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.3pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) The
Board shall administer the Plan unless and to the extent the Board delegates administration to a Committee as provided in subparagraph
4(i).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 10.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) The
Board may establish, from time to time and at any time, subject to the limitations of the Plan as set forth herein, such rules and regulations
and amendments and supplements thereto, as it deems necessary to comply with applicable law and regulation and for the proper administration
of the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(c) The
Board shall from time to time determine those executives and employees who shall receive Awards, and shall determine the numbers of shares
on which Awards shall be granted to each such person and the nature of the Awards to be granted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 11.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(d) All
Awards are subject to withholding of all applicable taxes, and the Board may condition the delivery of any shares or other benefits under
the Plan on satisfaction of the applicable withholding obligations. The Board, in its discretion, and subject to such requirements as
the Board may impose prior to the occurrence of such withholding, may permit such withholding obligation to be satisfied through cash
payments, through the surrender of shares of Common Stock that the participant already owns, or through the surrender of shares of Common
Stock to which the participant is otherwise entitled under the Plan.</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(e) The
Board&rsquo;s interpretation and construction of the provisions of the Plan and the rules and regulations adopted by the Board shall be
final, unless otherwise determined by the Board. No member of the Board or the Committee shall be liable for any action taken or determination
made in good faith in respect of the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(f) The
Board may impose such other terms and conditions not inconsistent with the terms of the Plan, as it deems advisable, including, without
limitation, restrictions and requirements relating to (i) the registration, listing or qualification of the Common Stock, (ii) the grant
or exercise of Awards, or (iii) the shares of Common Stock acquired under the Plan. The Committee may require that a participant notify
the Company of any disposition of shares of Common Stock purchased under the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(g) Notwithstanding
any other provisions of the Plan, the Company shall have no obligation to deliver any shares of Common Stock under the Plan or make any
other distribution of benefit under the Plan unless such delivery or distribution would comply with all applicable laws (including, without
limitation, the Exchange Act and the United States Securities Act of 1933, as amended), and the applicable requirements of any securities
exchange or similar entity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(h) The
Board may delegate administration of the Plan to a Committee, and the term &ldquo;<U>Committee</U>&rdquo; shall apply to any Director
or Directors to whom such authority has been delegated. If administration of the Plan is delegated to a Committee, the Committee shall
have, in connection with the administration of the Plan, all of the powers heretofore possessed by the Board, including the power to delegate
nondiscretionary administrative duties to such employees of the Company as the Committee deems proper (and references to this Plan to
the &ldquo;Board&rdquo; shall thereafter be to the Committee), subject, however, to such resolutions, not inconsistent with the provisions
of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and restore to the Board
the administration of the Plan. In the discretion of the Board, the Committee may consist solely of two or more Non-Employee Directors.
Within the scope of such authority, the Board or the Committee may delegate to one or more Directors who are not Non-Employee Directors
the authority to grant Stock Awards to eligible persons who are not then subject to Section 16 of the Exchange Act.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -30in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">5.</TD><TD>Participation in the Plan</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.8pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in">(a) Participation
in the Plan shall be limited to the directors, executives and employees of the Company and its Subsidiaries, and any consultant or other
individual providing services to the Company or a Subsidiary, who shall be designated by the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) A
consultant shall not be eligible for the grant of an Award if, at the time of grant, a Form S-8 Registration Statement under the
Securities Act (&ldquo;<U>Form S-8</U>&rdquo;) is not available to register either the offer or the sale of the Company&rsquo;s
securities to such consultant because of the nature of the services that the consultant is providing to the Company or a Subsidiary,
or because the consultant is not a natural person, or as otherwise provided by the rules governing the use of Form S-8, unless the
Company determines both (i) that such grant (A) shall be registered in another manner under the Securities Act (<I>e.g</I>., on a
Form S-3 Registration Statement) or (B) does not require registration under the Securities Act in order to comply with the
requirements of the Securities Act, if applicable, and (ii) that such grant complies with the securities laws of all other relevant
jurisdictions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">6.</TD><TD>Stock Subject to the Plan</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">(a) There
shall be reserved for the granting of Awards pursuant to the Plan, and for issuance and sale pursuant to such Awards, 1,000,000 shares
of Common Stock. To determine the number of shares of Common Stock available at any time for the granting of Awards, there shall be deducted
from the total number of reserved shares of Common Stock, the number of shares of Common Stock in respect of which Awards have been made
pursuant to the Plan that are still outstanding or have been exercised. If any shares subject to an Award are withheld and not delivered
to a participant because the Award is exercised through a reduction of shares subject to the Award (<I>i.e</I>., &ldquo;<U>net exercised</U>&rdquo;),
the number of shares that are withheld shall no longer be available for issuance under the Plan. If any shares subject to an Award are
not delivered to a participant because such shares are withheld in satisfaction of the withholding of taxes incurred in connection with
the exercise of an Option, or the award of Restricted Shares, the number of shares that are not delivered to the participant shall no
longer be available for subsequent issuance under the Plan. If the exercise price of any Option is satisfied by tendering shares of Common
Stock held by the participant (either by actual delivery or attestation), the number of shares so tendered shall not remain available
for subsequent issuance under the Plan. The shares of Common Stock to be issued in connection with Awards made pursuant to the Plan shall
be made available from the authorized and unissued shares of Common Stock or shares subsequently acquired by the Company as treasury shares.
If for any reason shares of Common Stock as to which an Award has been made are forfeited or otherwise cease to be subject to purchase
thereunder, then such shares of Common Stock again shall be available for issuance in connection with Awards made pursuant to the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) In
the event of reorganization, recapitalization, stock split, stock dividend, combination of shares of Common Stock, merger, consolidation,
share exchange, acquisition of property or stock, or any change in the capital structure of the Company, the Board shall make such adjustments
as may be appropriate, in its discretion, in the number and kind of shares reserved for Awards and in the number, kind and price of shares
covered by Awards made pursuant to the Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 42pt; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 0.5in">7.</TD><TD>Terms and Conditions of Options</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 45.6pt 0pt 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in">(a) Each
Option granted pursuant to the Plan shall be evidenced by an Option Agreement in such form as the Board from time to time may determine.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) The exercise price per share
for Options shall be established by the Board at the time of the grant of Options pursuant to the Plan. The exercise price for
Options granted to participants subject to taxation in the United States shall not be less than the Fair Market Value of a share of
Common Stock on the date on which the Option is granted. The exercise price of Options granted to participants who are not subject
to taxation in the United States shall be established by the Board and may, in the Board&rsquo;s discretion, be less than the Fair
Market Value. If the Board does not establish a specific exercise price per share at the time of grant, the exercise price per share
shall be equal to the Fair Market Value of a share of Common Stock on the date of grant of the Option.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 13pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 13pt 0pt 0in; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 13pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(c) The
term of each Option shall be determined by the Board at the time of grant of the Option, provided that if no term is established by the
Board, the term of the Option shall be five years from the date on which it is granted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 10.2pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(d) The
Board may provide in the Option Agreement that the right to exercise each Option for the number of shares subject to each Option shall
vest in the Option holder over such period of time, or upon the occurrence of such event, contingency or condition (which may be based
on performance or other criteria), as the Board, in its discretion, shall determine for each Option holder. The vesting provisions of
individual Options may vary. If the Board does not designate a vesting schedule, the Option shall be exercisable immediately after the
date of grant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 9.8pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(e) Options
shall be nontransferable and nonassignable, except that Options may be transferred by testamentary instrument or by the laws of descent
and distribution. Notwithstanding the foregoing, the Board may set forth in the Option Agreement at the time of grant or thereafter, that
the Option may be transferred to members of the optionee&rsquo;s immediate family, to trusts solely for the benefit of such immediate
family members, and to partnerships in which such family members and/or trusts are the only partners. For this purpose, immediate family
means the optionee&rsquo;s spouse, parents, children, stepchildren, grandchildren, and legal dependents. Any transfer of Options made
under this provision shall not be effective until notice of such transfer is delivered to the Company. In the event an Option is transferred
in accordance with the foregoing, the Option shall be exercisable solely by the transferee and shall remain subject to the provisions
of the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.9pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(f) In
the case of an Option holder who is an employee of the Company or its Subsidiaries, upon voluntary or involuntary termination of an Option
holder&rsquo;s active employment for any reason (including illness or disability), the holder&rsquo;s Option and all rights thereunder
shall terminate effective at the close of business on the date the Option holder ceases to be an active, regular employee of the Company
or any of its Subsidiaries, except (i) to the extent previously exercised and (ii) as provided in subparagraphs (g), (h) and (i) of this
paragraph 7.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.4pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(g) In
the event an employee Option holder (i) takes a leave of absence from the Company or any of its Subsidiaries for personal reasons or (ii)
terminates his employment or ceases providing services to the Company and any of its Subsidiaries, by reason of illness, disability, voluntary
termination with the consent of the Board, or other special circumstances, the Board may consider his case and may take such action in
respect of the related Option Agreement as it may deem appropriate under the circumstances, including accelerating the time previously
granted Options may be exercised and extending the time following the Option holder&rsquo;s termination of active employment during which
the Option holder is entitled to purchase the shares of Common Stock subject to such Options, provided that in no event may any Option
be exercised after the expiration of the term of the Option.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 17pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(h) If an
Option holder dies during the term of his Option without having fully exercised his Option, the executor or administrator of his
estate or the person who inherits the right to exercise the Option by bequest or inheritance shall have the right at any time
following the Option holder&rsquo;s death to purchase the number of shares of Common Stock that the deceased Option holder was
entitled to purchase at the date of his death, after which the Option shall lapse, provided that in no event may any Option be
exercised after the expiration of the term of the Option. In the event of the death of the transferee of an Option transferred in
accordance with subparagraph 7(e), above, the Option shall be exercisable by the executors, administrators, legatees or distributees
of the transferee&rsquo;s estate, as the case may be, for a period of one (1) year following the date of the transferee&rsquo;s
death, provided that in no event may the Option be exercised after the expiration of the term of the Option.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6pt 0pt 0in; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(i) If
an Option holder terminates employment without his having fully exercised his Option due to his retirement with the consent of the Company,
then such Option holder shall have the right within 90 days of the Option holder&rsquo;s termination of employment to purchase the number
of shares of Common Stock that the Option holder was entitled to purchase at the date of his termination, after which the Option shall
lapse, provided that in no event may any Option be exercised after the expiration of the term of the Option. The Board may cancel an Option
during the 90-day period referred to in this paragraph, if the participant engages in employment or activities contrary, in the opinion
of the Board, to the best interests of the Company. The Board shall determine in each case whether a termination of employment shall be
considered a retirement with the consent of the Company, and, subject to applicable law, whether a leave of absence shall constitute a
termination of employment. Any such determination of the Board shall be final and conclusive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(j) On
receipt of written notice of exercise, the Board may elect to cash out all or part of the portion of any stock Option to be exercised
by paying the participant an amount, in cash or Common Stock, equal to the excess of the Fair Market Value of the Common Stock that is
subject to the Option over the Option Price times the number of Common Shares subject to the Option on the effective date of such cash-out.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">8.</TD><TD>Methods of Exercise of Options</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 7.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) An
Option holder (or other person or persons, if any, entitled to exercise an Option hereunder) desiring to exercise an Option granted pursuant
to the Plan as to all or part of the shares of Common Stock covered by the Option shall (i) notify the Company in writing at its principal
office to that effect, specifying the number of shares of Common Stock to be purchased and the method of payment therefor, and (ii) make
payment or provisions for payment for the shares of Common Stock so purchased in accordance with this paragraph 8. Such written notice
may be given by means of a facsimile transmission. If a facsimile transmission is used, the Option holder should mail the original executed
copy of the written notice to the Company promptly thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 77.9pt; text-indent: -0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b)
Payment or provision for payment shall be made as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; margin-left: 0in; text-indent: 0in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 1in">(i) The Option holder shall
deliver to the Company at the address set forth in subparagraph 8(a), cash in an amount equal to the aggregate purchase price of the
shares of Common Stock as to which such exercise relates; or</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">(ii) The Option holder shall tender to the Company, by either actual
delivery of shares or by attestation, shares of Common Stock already owned by the Option holder that, together with any cash
tendered therewith, have an aggregate fair market value (determined based on the Fair Market Value on the date the notice set forth
in subparagraph 8(a) is received by the Company) equal to the aggregate purchase price of the shares of Common Stock as to which
such exercise relates; or</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">(iii) The
Option holder shall deliver to the Company an exercise notice, together with irrevocable instructions to a broker to deliver promptly
to the Company the amount of sale or loan proceeds necessary to pay the aggregate purchase price of the shares of Common Stock as to which
such exercise relates and to sell the shares (or a sufficient portion of the shares) of Common Stock to be issued upon exercise of the
Option to pay the exercise price and any tax withholding resulting from such exercise and deliver the cash proceeds, less commissions
and brokerage fees, to the Option holder or to deliver the remaining shares of Common Stock to the Option holder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">Notwithstanding the foregoing provisions,
the Board, in granting Options pursuant to the Plan, may limit the methods in which an Option may be exercised by an person and, in processing
any purported exercise of an Option granted pursuant to the Plan, may refuse to recognize the method of exercise selected by the Option
holder (other than the method of exercise set forth in subparagraph 8(b)(i)).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 13.3pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(c) An
Option holder at any time may elect in writing to abandon an Option in respect of all or part of the number of shares of Common Stock
as to which the Option shall not have been exercised.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 14.8pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(d) An
Option holder shall have none of the rights of a shareholder of the Company until the shares of Common Stock covered by the Option are
issued to him upon exercise of the Option.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">9.</TD><TD>Terms and Conditions of Restricted Share Awards</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) Each
award of Restricted Shares under the Plan shall be evidenced by a Restricted Share Agreement between the recipient and the Company in
such form as the Board from time to time may determine. Such Restricted Shares shall be subject to all applicable terms of the Plan and
may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Share Agreements entered
into under the Plan need not be identical.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 11.9pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) Restricted
Shares may be sold or awarded under the Plan for such consideration as the Board may determine, including (without limitation) cash, cash
equivalents, full-recourse promissory notes, past services and future services; provided, however, that to the extent that an Award consists
of newly issued Restricted Shares, the Award recipient shall furnish consideration with a value not less than the par value of such Restricted
Shares in the form of cash equivalents or past services rendered to the Company or its subsidiaries, as the Board may determine.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 20.6pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(c) Each
award of Restricted Shares may or may not be subject to forfeiture to the Company, or &ldquo;vesting.&rdquo; Vesting shall occur, in
full or in installments, upon satisfaction of the conditions specified in the Restricted Share Agreement. During any restricted
period, the recipient shall not be permitted to sell, transfer, pledge or assign Restricted Shares awarded under this Plan. In the
event of the recipient&rsquo;s retirement, disability or death, or in cases of special circumstances, the Board, in its sole
discretion, may waive, in whole or in part, any or all remaining restrictions with respect to such recipient&rsquo;s Restricted
Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.1pt 0pt 0in; text-indent: 0.5in"></P>

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    <DIV STYLE="break-before: page; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.1pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(d) The
holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Company&rsquo;s other
shareholders. A Restricted Share Agreement, however, may require that the holders of Restricted Shares invest any cash dividends received
in additional Restricted Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award
with respect to which the dividends were paid.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 9pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(e) When
an Award of Restricted Shares is granted hereunder, the Company shall issue a certificate or certificates in respect of such Restricted
Shares, which shall be registered in the name of the recipient and, if applicable, shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Award in substantially the following form:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 70pt 0pt 77.9pt; text-align: justify"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 70pt 0pt 77.9pt; text-align: justify"><I>&ldquo;The transferability
of the shares represented by this certificate are subject to the terms and conditions (including forfeiture) of a Restricted Share Agreement
entered into between the registered owner and Highway Holdings Limited. A copy of such agreement is on file in the offices of the Secretary
of the Company.&rdquo;</I></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">10.</TD><TD>Cancellation and Rescission of Awards</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">Unless the Option Agreement or
Restricted Share Agreement specifies otherwise, the Board may cancel, rescind, suspend, withhold or otherwise limit or restrict any unexpired,
unpaid, or deferred Awards at any time if the participant is not in compliance with all applicable provisions of the applicable Award
Agreement and the Plan.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">11.</TD><TD>Amendments and Discontinuance of the Plan</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) The
Board at any time, and from time to time, may amend the Plan; provided, however, that any Award granted before amendment of the Plan shall
not be impaired by any amendment of the Plan, except with the written consent of the holder of the Award. Except as provided in paragraph
6(b) relating to adjustments upon changes in Common Stock, no amendment shall be effective unless approved by the shareholders of the
Company to the extent shareholder approval is necessary to satisfy the requirements of Rule 16b-3 or any securities exchange listing requirements
applicable to the Company. The Board may, in its sole discretion, submit any other amendment to the Plan for shareholder approval.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 7.2pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) The
Board at any time, and from time to time, may amend the terms of any one or more outstanding Awards; provided, however, that no Award
shall be impaired by any such amendment, except with the written consent of the holder of the Award.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>




<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">12.</TD><TD>Plan Subject to Governmental Laws and Regulations</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">The Plan and the terms of the Awards
made pursuant to the Plan shall be subject to all applicable governmental laws and regulations. Notwithstanding any other provision of
the Plan to the contrary, the Board may in its sole and absolute discretion make such changes in the Plan as may be required to conform
the Plan to such laws and regulations.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -30in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">13.</TD><TD>Non-Guarantee of Employment</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.4pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">Nothing in the Plan or in any Award
granted pursuant to the Plan shall be construed as a contract of employment between the Company or a Subsidiary, and selection of any
individual as a participant in the Plan will not give that individual the right to continue in the employ of the Company or a Subsidiary,
the right to continue to provide services to the Company or any Subsidiary or as a limitation of the right of the Company or a Subsidiary
to discharge any participating employee or any other individual at any time.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">14.</TD><TD>Exclusion From Retirement and Fringe Benefit Computation</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 7.7pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">No portion of any Award under this
Plan shall be taken into account as &ldquo;wages,&rdquo; &ldquo;salary&rdquo; or &ldquo;compensation&rdquo; for any purpose, whether in
determining eligibility, benefits or otherwise, under (i) any pension, retirement, profit sharing or other qualified or non-qualified
plan of deferred compensation, (ii) any employee welfare or fringe benefit plan including, but not limited to, group insurance, hospitalization,
medical, and disability, or (iii) any form of extraordinary pay including but not limited to bonuses, sick pay and vacation pay.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">15.</TD><TD>Change In Control Provisions</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.4pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">Notwithstanding any other provision
of the Plan to the contrary, unless otherwise provided in an Option Agreement or a Restricted Share Agreement, in the event of a Change
in Control:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">(a) Any
Awards outstanding as of the date of such Change in Control and not then exercisable shall become fully exercisable to the full extent
of the original grant;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1in">(b) The
Board shall have full discretion, notwithstanding anything herein or in an Option Agreement or a Restricted Share Agreement to the contrary,
to do any or all of the following with respect to an outstanding Award:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">(1) To
cause any Award to be canceled, provided notice of at least 15 days thereof is provided before the date of cancellation;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 37.1pt 0pt 0in; text-indent: 107.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">(2) To
provide that the securities of another entity be substituted hereunder for the Common Stock and to make equitable adjustment with respect
thereto;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">(3) To grant
the participant by giving notice during a pre-set period to surrender all or part of an Option to the Company and to receive cash in
an amount equal to the amount by which the price per share of Common Stock, if any, paid in any corporate transaction that gave rise
to the Change in Control shall exceed the amount which the participant must pay to exercise the Option per share of Common Share
under the Option (the &ldquo;Spread&rdquo;) multiplied by the number of Common Shares granted under the Option;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 10.2pt 0pt 0pt; text-indent: 107.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 10.2pt 0pt 0pt; text-indent: 107.9pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 10.2pt 0pt 0pt; text-indent: 107.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">(4) To
require the assumption of the obligation of the Company under the Plan subject to appropriate adjustment; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 1.5in">(5)
To take any other action the Board determines to take.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -30in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: bold 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">16.</TD><TD>Liability Limited; Indemnification</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 22pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) To
the maximum extent permitted by law, neither the Board or the Committee, nor any of the members of the Board or the Committee, shall be
liable for any action or determination made with respect to this Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 6.5pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) In
addition to such other rights of indemnification that they may have, the members of the Board and the Committee shall be indemnified by
the Company to the maximum extent permitted by law against any and all liabilities and expenses incurred in connection with their service
in such capacity.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">17.</TD><TD>Miscellaneous</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) The
headings in this Plan are for reference purposes only and shall not affect the meaning or interpretation of the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) This
Plan shall be governed by, and construed in accordance with, the laws of British Virgin Islands without regard to principles of conflict
of laws of any jurisdiction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(c) All
notices and other communications made or given pursuant to this Plan shall be in writing and shall be sufficiently made or given if delivered
or mailed, addressed to the participant at the address contained in the records of the Company or to the Company at its principal executive
offices.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in">18.</TD><TD>Duration of the Plan</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(a) Unless
sooner terminated by the Board, the Plan shall automatically terminate on the day before the tenth anniversary of the date the Plan is
adopted by the Board. No Awards may be granted under the Plan while the Plan is suspended or after it is terminated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0in; text-align: justify; text-indent: 0.5in">(b) Suspension
or termination of the Plan shall not impair rights and obligations under any Award granted while the plan is in effect, except with the
written consent of the Participant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 34pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 34pt 0pt 0in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">A-11</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 34pt 0pt 0in; text-indent: 0.5in"></P>

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<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>ea021290201ex99-2_highway.htm
<DESCRIPTION>LETTER TO SHAREHOLDERS
<TEXT>
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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 99.2</B></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Dear Shareholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">I write to you today to provide an update on
our extremely challenging past fiscal year 2024 and our future plans. Following the brutal shutdowns caused by the global pandemic,
we didn't think things could get any worse. However, this past year has tested us even further. Despite these extensive hardships,
which lasted right to the end of this fiscal year, I am pleased to report that we have finally started to see light on the other
side of this dark tunnel.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Navigating Through Unprecedented Challenges</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Fiscal 2024 has been one of the most
difficult periods in my professional career. The swift and severe revenue decline, caused by the strong cancelations and reduction
of purchase orders from all our customers driven by post-COVID-19 demand fluctuations and resulting inventory overproduction, lasted
much longer than initially expected and caused us to lose over 60% of our business at the lowest points. The severity of the
negative impact on our company forced us into a severe survival mode.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our prudent financial management in prior years
allowed us to build up reserves that proved crucial in navigating these turbulent times. While we were stretched thin, managing expenses
without proportionately reducing our business capabilities, we made a decision to preserve our core assets&mdash;our engineers and technicians.
We recognized that cutting these key personnel would save much of our cost in the short term but severely damage the company's future
prospects and put us on a path that would be difficult to recover from when market conditions eventually improved.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Balancing Act for Future Stability</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">This period required a delicate balancing
act between maintaining customer relationships, managing and keeping our key staff, as well as trying to ensure long-term financial
stability. Despite the numerous challenges, our efforts have begun to bear fruit. Recently, we have seen an increase in orders from
nearly all our customers, indicating that the worst of the crisis is potentially behind us. We are not out of the woods but are
seeing signs of improvement and renewed business optimism at many of our customers. Importantly, our strategy to use financial
reserves prudently has helped us survive without jeopardizing the company's future.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Strategic Decisions and Future Opportunities</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">One of our strategic actions was the planned
acquisition of Synova Metall- und Kunststofftechnik GmbH, a company in Germany, that we announced in December 2023. Synova operates
an OEM/ODM business in similar industries to our company, with a different but equally, high-value customer base. Initially, their
business appeared resilient, but finally it too experienced a significant business downturn. Consequently, we decided to pause the
acquisition until Synova&rsquo;s business stabilizes and we can accurately reassess its value. Our priority is on helping our
situation, not adding further burden to a stressed situation. For now, the acquisition is still on the back burner and can be
restarted when the situation improves and it becomes beneficial to pursue an enhancement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We believe that revisiting this acquisition
at the end of the downturn may still offer the compelling synergistic benefits we found attractive in our initial due diligence,
while helping us expand our OEM/ODM operations with lower operational costs. We also believe we can find a solution to complete the
acquisition on the right terms and conditions. Synova is still considered one of our best solutions for an increased OEM/ODM
business. The owner of Synova is an excellent businessman with excellent contacts and customer relationships. For example, Synova
has over one hundred potential customers with little or no active business primarily due to high European operating costs. With our
lower-cost labor and more efficient operating model, we are confident we can help address the cost issue and better leverage and
grow revenue at these customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Paving the Path for Diversification and Growth</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">This crisis has reinforced the urgent need for
a second, robust business line to safeguard against similar future disruptions. We are committed to creating a new, unrelated business
that can start small and grow over time, providing a stable foundation and additional revenue streams. We must be able at least in part
to control our own future and not fully depend on our customers well being.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have made several attempts in the past to
diversify but were forced to halt due to pressing issues demanding management's full attention. This time, we are better prepared.
Our COO has assumed significant responsibility for our existing OEM business, and if we close the Synova acquisition, we will expand
our executive team with the owner of Synova, a capable leader with deep industry knowledge and contacts who could take charge of the
company&rsquo;s OEM/ODM business segment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Building a Sustainable Future</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We are confident that 2024 will mark the beginning
of a new business era, which will not only stabilize the company but also offer significant growth potential beyond our current OEM manufacturing
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As we look to the future, we remain focused on
driving sustainable growth and creating long-term value for our shareholders. Our strategic priorities include further innovation, expanding
our global presence, and enhancing our operational efficiencies. We are confident that with your continued support, we will achieve these
goals and more.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In conclusion, our resilience and strategic
foresight have positioned us to emerge stronger. We are committed to growing shareholder value and ensuring the long-term success of
Highway Holdings Limited. I would like to express my sincere gratitude to our shareholders, employees, customers, and partners for
their unwavering support. Together, we will continue to build on our past successes and create a brighter future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="text-align: left; width: 70%"><P STYLE="margin-top: 0; margin-bottom: 0">Thank you for your trust and confidence in our company.</P>
                                         <P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
                                         <P STYLE="margin-top: 0; margin-bottom: 0">Sincerely yours,</P>
                                         <P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
                                         <P STYLE="margin-top: 0; margin-bottom: 0">Roland Kohl,</P>
                                         <P STYLE="margin-top: 0; margin-bottom: 0">Chief Executive Officer, Highway Holdings Limited</P></TD>
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