DEF 14A

DEF 14A 1 d247872ddef14a.htm DEF 14A DEF 14A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No. )

Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐

Check the appropriate box: ☐


☐		Preliminary Proxy Statement

☐		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☒		Definitive Proxy Statement

☐		Definitive Additional Materials

☐		Soliciting Material under §240. 14a-12

ZAI LAB LIMITED

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):



☒	No fee required.

☐	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

	(1)	Title of each class of securities to which transaction applies:
	(2)	Aggregate number of securities to which transaction applies:
	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
	(4)	Proposed maximum aggregate value of transaction:
	(5)	Total fee paid:

☐	Fee paid previously with preliminary materials.

☐	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

	(1)	Amount Previously Paid:
	(2)	Form, Schedule or Registration Statement No.:
	(3)	Filing Party:
	(4)	Date Filed:

This document shall also serve as a circular to holders of the ordinary shares of Zai Lab Limited for purposes of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (“HK Listing Rules”).

Warning: The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer of awards comprising share options. If you are in doubt about any of the contents of this document, you should obtain independent professional advice.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

This document, for which the directors of Zai Lab Limited collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the purpose of giving information with regard to Zai Lab Limited. The directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this document is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this document misleading.

LOGO

4560 Jinke Road

Bldg. 1, Fourth Floor

Pudong, Shanghai, China 201210

(Nasdaq Trading Symbol: ZLAB; HKEx Stock Code: 9688)

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Notice is hereby given that the 2022 Annual General Meeting of Shareholders (the “Annual Meeting”) of Zai Lab Limited (the “Company” or “us”) will be held:


Time and Date:		8:00 a.m. (U.S. Eastern Time) on Wednesday, June 22, 2022 /
		8:00 p.m. (Shanghai and Hong Kong Time) on Wednesday, June 22, 2022

Physical Location:		4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210

Virtual Meeting Site:		www.virtualshareholdermeeting.com/ZLAB2022

The purpose of the meeting is to consider and vote on the following matters:

An ordinary resolution to re-elect Samantha (Ying) Du to serve as a director until the 2023 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal;

An ordinary resolution to re-elect Kai-Xian Chen to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect John D. Diekman to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect Richard Gaynor to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect Nisa Leung to serve as a director until the 2023 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal;

An ordinary resolution to re-elect William Lis to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect Scott Morrison to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect Lonnie Moulder to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

An ordinary resolution to re-elect Peter Wirth to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal;

10.

A special resolution to adopt the Sixth Amended and Restated Memorandum and Articles of Association of the Company in the form annexed hereto as Appendix A as described in this Proxy Statement, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited;

11.

An ordinary resolution to approve the Zai Lab Limited 2022 Equity Incentive Plan, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective;

12.

An ordinary resolution to ratify the appointment of KPMG LLP (“KPMG”) as the Company’s independent registered public accounting firm and auditor for the fiscal year ending December 31, 2022 for the Company’s annual consolidated financial statements filed with the U.S. Securities and Exchange Commission (“SEC”) and its internal controls over financial reporting in accordance with the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the consolidated financial statements of the Group for the year ending December 31, 2022 submitted to The Stock Exchange of Hong Kong Limited in accordance with the HK Listing Rules, conditioned upon and subject to the Company’s receipt of the requisite approvals from The Stock Exchange of Hong Kong Limited and the Financial Reporting Council of Hong Kong;

13.

An ordinary resolution, within the parameters of Rule 13.36 of the HK Listing Rules, to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or American Depositary Shares not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, conditioned on and subject to dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective and other conditions described in this Proxy Statement;

14.

An ordinary resolution to approve, on an advisory basis, the compensation of our named executive officers, as disclosed in this Proxy Statement;

15.

An ordinary resolution to hold an advisory vote on the frequency of future advisory votes on the compensation of our named executive officers; and

16.

To transact such other business as may properly come before the Annual Meeting and any adjournment or postponement.

The record date for the Annual Meeting is April 25, 2022 (ordinary share record date). Only shareholders of record as of 4:30 p.m. (Shanghai and Hong Kong Time) on April 25, 2022 are entitled to receive notice of, and to attend and to vote at the Annual Meeting or any adjournment thereof.

Your vote is important to us. Whether or not you expect to attend the Annual Meeting, we urge you to vote your shares as soon as possible. The manner in which you hold your shares will dictate how you can vote:

Shareholders of Ordinary Shares

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If you are a shareholder of record of our ordinary shares registered on our Hong Kong register or Cayman Islands register as of the record date, you may vote your shares by submitting your proxy through www.proxyvote.com no later than 8:00 a.m. (U.S. Eastern Time) /8:00 p.m. (Shanghai and Hong Kong Time) on June 21, 2022, or if you received printed proxy materials, you may submit your vote by completing, signing and dating each proxy card received and returning it in the prepaid envelope. Sign your name exactly as it appears on the proxy card. Proxy cards submitted by mail must be received no later than June 15, 2022, to be voted at the Annual Meeting.

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If you are a beneficial owner of ordinary shares registered on the record date in the name of a brokerage firm, bank or other financial institution, you should have received information containing voting instructions from that organization rather than from us. Simply follow the voting instructions so that your vote is counted. To vote at the Annual Meeting, you must obtain a legal proxy or broker’s proxy card from your broker, bank or other agent. Follow the instructions from your broker or bank included with these proxy materials or contact your broker or bank to request a proxy form.

ADS Holders

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If you are a holder of record of our ADSs, each representing ten of our ordinary shares, as of 4:30 p.m. (U.S. Eastern Time) on April 25, 2022 who wishes to exercise your voting rights for the underlying ordinary shares, you must act through the depositary of the ADSs, Citibank, N.A. (“Citibank”), to vote the ordinary shares represented by your ADSs. Citibank will distribute information to ADS holders as of 4:30 p.m. (U.S. Eastern Time) on April 25, 2022 describing how voting instructions may be delivered to Citibank by ADS holders.

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If you are a beneficial owner of ADSs registered as of 4:30 p.m. (U.S. Eastern Time) on April 25, 2022 in the name of a brokerage firm, bank or other financial institution, you should have received information containing voting instructions from that organization rather than from Citibank. Simply follow the voting instructions so that your vote is counted.

By Order of the Board of Directors,

LOGO

Samantha (Ying) Du

Director, Chairperson of the Board of Directors and Chief Executive Officer

May 2, 2022

ZAI LAB LIMITED

PROXY STATEMENT FOR

2022 ANNUAL GENERAL MEETING OF SHAREHOLDERS

TABLE OF CONTENTS


QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING		1

MATTERS REQUIRING SHAREHOLDER ACTION		10

PROPOSALS 1-9	ELECTION OF DIRECTORS	10

PROPOSAL 10	AS A SPECIAL RESOLUTION, ADOPTION OF THE SIXTH AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION	15

PROPOSAL 11	AS AN ORDINARY RESOLUTION, APPROVAL OF THE ZAI LAB LIMITED 2022 EQUITY INCENTIVE PLAN, CONDITIONED ON AND SUBJECT TO THE DUAL-PRIMARY LISTING OF THE COMPANY ON THE MAIN BOARD OF THE STOCK EXCHANGE OF HONG KONG LIMITED BECOMING EFFECTIVE	19

PROPOSAL 12	AS AN ORDINARY RESOLUTION, RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND AUDITOR FOR THE FISCAL YEAR ENDING DECEMBER 31, 2022 FOR THE COMPANY’S ANNUAL CONSOLIDATED FINANCIAL STATEMENTS FILED WITH THE SEC AND ITS INTERNAL CONTROLS OVER FINANCIAL REPORTING IN ACCORDANCE WITH THE EXCHANGE ACT AND THE CONSOLIDATED FINANCIAL STATEMENTS OF THE GROUP FOR THE YEAR ENDING DECEMBER 31, 2022 SUBMITTED TO THE STOCK EXCHANGE OF HONG KONG LIMITED IN ACCORDANCE WITH THE HK LISTING RULES, CONDITIONED UPON AND SUBJECT TO THE COMPANY’S RECEIPT OF THE REQUISITE APPROVALS FROM THE STOCK EXCHANGE OF HONG KONG LIMITED AND THE FINANCIAL REPORTING COUNCIL OF HONG KONG;	29

PROPOSAL 13	AS AN ORDINARY RESOLUTION, APPROVAL OF THE GENERAL MANDATE TO ISSUE SHARES	32

PROPOSAL 14	AS AN ORDINARY RESOLUTION, THE APPROVAL, ON AN ADVISORY BASIS, OF COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS	33

PROPOSAL 15	AS AN ORDINARY RESOLUTION, THE ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS	35

TRANSACTION OF OTHER BUSINESS		37

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		38

CORPORATE GOVERNANCE		40

EXECUTIVE OFFICERS		48

CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS		50

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION		52

AUDIT COMMITTEE REPORT		54

EXECUTIVE COMPENSATION		56

COMPENSATION COMMITTEE REPORT		68

COMPENSATION TABLES		69

DIRECTOR COMPENSATION		74

ADDITIONAL INFORMATION		75

DELIVERY OF PROXY MATERIALS		75

APPENDIX A: SIXTH MEMORANDUM OF ASSOCIATION AND SIXTH ARTICLES OF ASSOCIATION		A-1

APPENDIX B: ZAI LAB LIMITED 2022 EQUITY INCENTIVE PLAN		B-1

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ZAI LAB LIMITED

4560 Jinke Road

Bldg. 1, Fourth Floor

Pudong, Shanghai, China 201210

PROXY STATEMENT

FOR THE 2022 ANNUAL GENERAL MEETING OF SHAREHOLDERS

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDER MEETING TO BE HELD ON JUNE 22, 2022

This Proxy Statement and the Annual Report on Form 10-K for the fiscal year ended December 31, 2021 of Zai Lab Limited (the “Company” or “us”) are available for viewing, printing and downloading at www.proxyvote.com. To view these materials, please have your 16-digit control number included on your Notice of Internet Availability of Proxy Materials.

You may also obtain a printed copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “2021 Annual Report on Form 10-K”), and our annual report for the fiscal year ended December 31, 2021 prepared in accordance with the HK Listing Rules (the “2021 HK Annual Report”), including audited consolidated financial statements, free of charge by sending a written request to: Zai Lab Limited at 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, Attention Corporate Secretary. Exhibits to our 2021 Annual Report on Form 10-K will be provided upon written request and payment of an appropriate processing fee. Copies of our 2021 Annual Report on Form 10-K and this Proxy Statement are also available online through the SEC, at www.sec.gov, The Stock Exchange of Hong Kong Limited (the “HKEx”), at www.hkexnews.hk and on our website at https://www.zailaboratory.com/ under “Investors.” Copies of our 2021 HK Annual Report are also available online through the HKEx at www.hkexnews.hk and on our website at https://www.zailaboratory.com/ under “Investors.”

All references to “Zai Lab,” the “Company,” “we,” “us” or “our” in this Proxy Statement mean Zai Lab Limited.

QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING

Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

Pursuant to rules adopted by the SEC, we have elected to provide access to our proxy materials over the Internet. Accordingly, we have sent you a Notice of Internet Availability of Proxy Materials (the “Notice”), because the Board of Directors is soliciting your proxy to vote at the Annual Meeting, including at any adjournments or postponements of the meeting. All shareholders will have the ability to access the proxy materials on the website referred to in the Notice or ask to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found in the Notice. We intend to mail the Notice on or about May 2, 2022 to all shareholders of record entitled to vote at the Annual Meeting.

We encourage you to take advantage of the availability of the proxy materials on the Internet in order to help lower the costs of delivery and reduce the Company’s environmental impact.

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Will I receive any other proxy materials by mail?

We may send you a proxy card or a second notice on or after May 22, 2022. Holders of record of our American Depositary Shares (“ADSs”) as of 4:30 p.m. (Shanghai and Hong Kong Time) on April 25, 2022, or the ADS record date, will receive ADS voting instructions from the depositary of the ADSs, Citibank, N.A. (“Citibank”).

Why am I receiving these materials?

You received these materials because the Board of Directors is soliciting your proxy to vote your shares at the Annual Meeting. As a shareholder of record as of 4:30 p.m. (Shanghai and Hong Kong Time) on April 25, 2022, you are invited to attend the Annual Meeting and are entitled to vote on the items of business described in this Proxy Statement. Holders of our ADSs will not be entitled to attend the Annual Meeting and cannot vote their ADSs directly. Holders of our ADSs as of the ADS record date may exercise the voting rights with respect to the underlying ordinary shares in accordance with the provisions of the deposit agreement among the Company, Citibank and the holders and beneficial owners of ADSs (the “deposit agreement”).

What does it mean if I receive more than one notice regarding the Internet availability of proxy materials or more than one set of printed proxy materials?

If you hold your shares in more than one account, you may receive a separate Notice of Internet Availability of Proxy Materials or a separate set of printed proxy materials, including a separate proxy card or voting instruction form, for each account. To help ensure that all your shares are voted, please vote by Internet or by signing, dating and returning a proxy card or voting instruction form for each account.

Why is the Annual Meeting a hybrid meeting?

Due to the ongoing public health impact of the COVID-19 pandemic and to support the health and well-being of our directors, employees and shareholders, this year we will continue to rely on the latest technology to host a “hybrid” Annual Meeting. We believe that the available technology provides expanded access, improved communication and cost savings for our shareholders. Combined with allowing traditional in-person attendance, we believe that this strikes a good balance between leveraging technology and maintaining the ability for our directors, employees and shareholders to interact in person.

How do I attend the Annual Meeting?

If you are a shareholder of record of our ordinary shares, you may attend the Annual Meeting in person at 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, or virtually by visiting our Annual Meeting website at www.virtualshareholdermeeting.com/ZLAB2022. To participate in the Annual Meeting, you will need the 16-digit control number included on your Notice, proxy card or instructions that accompanied your proxy materials. Shareholders are encouraged to log in to this website and pre-register for the Annual Meeting before the start time of the meeting. Online check-in will begin 15 minutes prior to the start of the meeting, and you should allow ample time for the online check-in procedures. If you choose to attend the Annual Meeting virtually, there will be technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting website. If you encounter any difficulties accessing the virtual meeting website during the check-in or meeting time, please call the technical support number that will be posted on the Annual Meeting log-in page. Holders of ADSs will not be entitled to attend or vote at the Annual Meeting.

Who can vote at the Annual Meeting?

Only shareholders of record of our ordinary shares as of 4:30 p.m. (Shanghai and Hong Kong Time) on April 25, 2022 (Shanghai and Hong Kong Time) are entitled to vote at the Annual Meeting. As of 4:30 p.m. (Shanghai and Hong Kong Time) on April 25, 2022, we had 979,087,430 outstanding ordinary shares, all of which are entitled to vote with respect to all matters to be acted upon at the Annual Meeting. Of these shares, approximately

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173,218,060 were held in the name of Citibank, as depositary for the ADSs, each representing one ordinary share of our Company. Each shareholder of record is entitled to one vote for each ordinary share held by such shareholder. Holders of our ADSs cannot vote their ADSs directly. Instead, holders of our ADSs may exercise the voting rights with respect to the underlying ordinary shares in accordance with the provisions of the deposit agreement.

How do I submit questions at the Annual Meeting?

Shareholders who wish to raise questions at the Annual Meeting must submit their questions in advance to the meeting. To submit questions in advance of the Annual Meeting, go to www.proxyvote.com before 8:00 a.m. (U.S. Eastern Time) / 8:00 p.m. (Shanghai and Hong Kong Time) on June 21, 2022 and enter the 16-digit control number included on your Notice.

What am I voting on?

There are fifteen matters scheduled for a vote:

10.

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11.

12.

An ordinary resolution to ratify the appointment of KPMG as the Company’s independent registered public accounting firm and auditor for the fiscal year ending December 31, 2022 for the Company’s annual consolidated financial statements filed with the SEC and its internal controls over financial reporting in accordance with the Exchange Act and the consolidated financial statements of the Group for the year ending December 31, 2022 submitted to the HKEx in accordance with the HK Listing Rules, conditioned upon and subject to the Company’s receipt of the requisite approvals from the HKEx and the Financial Reporting Council of Hong Kong;

13.

An ordinary resolution, within the parameters of Rule 13.36 of the HK Listing Rules, to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or American Depositary Shares (“ADSs”) not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective and other conditions described in this Proxy Statement;

14.

An ordinary resolution to approve, on an advisory basis, the compensation of our named executive officers, as disclosed in this Proxy Statement; and

15.

An ordinary resolution to hold an advisory vote on the frequency of future advisory votes on the compensation of our named executive officers.

What if another matter is properly brought before the meeting?

The Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, it is the intention of the persons named in the accompanying proxy to vote on those matters in accordance with their best judgment.

How does the Board of Directors recommend that I vote?

The Board of Directors unanimously recommends that you vote:

FOR the ordinary resolution to re-elect Samantha (Ying) Du to serve as a director until the 2023 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal.

FOR the ordinary resolution to re-elect Kai-Xian Chen to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

FOR the ordinary resolution to re-elect John D. Diekman to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

FOR the ordinary resolution to re-elect Richard Gaynor to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

FOR the ordinary resolution to re-elect Nisa Leung to serve as a director until the 2023 annual general meeting of shareholders and until her successor is duly elected and qualified, subject to her earlier resignation or removal.

FOR the ordinary resolution to re-elect William Lis to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

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FOR the ordinary resolution to re-elect Scott Morrison to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

FOR the ordinary resolution to re-elect Lonnie Moulder to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

FOR the ordinary resolution to re-elect Peter Wirth to serve as a director until the 2023 annual general meeting of shareholders and until his successor is duly elected and qualified, subject to his earlier resignation or removal.

10.

FOR the special resolution to adopt the Sixth Amended and Restated Memorandum and Articles of Association of the Company in the form annexed hereto as Appendix A as described in this Proxy Statement, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective.

11.

FOR the ordinary resolution to approve the Zai Lab Limited 2022 Equity Incentive Plan, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective.

12.

FOR the ordinary resolution to ratify the appointment of KPMG as the Company’s independent registered public accounting firm and auditor for the fiscal year ending December 31, 2022 for the Company’s annual consolidated financial statements filed with the SEC and its internal controls over financial reporting in accordance with the Exchange Act and the consolidated financial statements of the Group for the year ending December 31, 2022 submitted to HKEx in accordance with the HK Listing Rules, conditioned upon and subject to the Company’s receipt of the requisite approvals from HKEx and the Financial Reporting Council of Hong Kong.

13.

FOR the ordinary resolution, within the parameters of Rule 13.36 of the HK Listing Rules, to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or American Depositary Shares (“ADSs”) not exceeding 20% of the total number of issued ordinary shares of the Company as of the date of passing of such ordinary resolution up to the next annual general meeting of shareholders of the Company, conditioned on and subject to dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective and other conditions described in this Proxy Statement.

14.

FOR the ordinary resolution to approve, on an advisory basis, the compensation of our named executive officers, as disclosed in this Proxy Statement.

15.

For a frequency of “3 years” for the ordinary resolution to hold an advisory vote on the frequency of future advisory votes on the compensation of our named executive officers.

How do I vote?

Shareholders of Record

If you are a shareholder of record of our ordinary shares registered on our Hong Kong register or Cayman Islands register as of the record date, you may vote at the Annual Meeting, by proxy through the Internet or vote by proxy using a proxy card that you may request or that we may elect to deliver at a later time. Whether or not you plan to attend the Annual Meeting, we urge you to vote by proxy to help ensure your vote is counted. You may still attend the meeting and vote even if you have already voted by proxy.

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To vote using a proxy card, simply complete, sign and date the proxy card that may be delivered and return it promptly in the prepaid envelope provided. Proxy cards submitted by mail must be received no later than June 15, 2022, to be voted at the Annual Meeting.

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To vote through the Internet, go to www.proxyvote.com to complete an electronic voting instruction form. You will be asked to provide the 16-digit control number included on your Notice. Your Internet vote must be received by 8:00 a.m. (U.S. Eastern Time) / 8:00 p.m. (Shanghai and Hong Kong Time) on June 21, 2022 to be counted.

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To vote while virtually attending the Annual Meeting, attend the meeting by visiting www.virtualshareholdermeeting.com/ZLAB2022. You will be asked to provide the 16-digit control number included on your Notice.

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To vote in person at the Annual Meeting, attend the meeting by going to 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210.

Beneficial Owners

If you are a beneficial owner of ordinary shares registered on the record date in the name of a brokerage firm, bank or other financial institution, you should have received information containing voting instructions from that organization rather than from us. Simply follow the voting instructions to help ensure that your vote is counted. To vote at the Annual Meeting, you must obtain a legal proxy or broker’s proxy card from your broker, bank or other agent. Follow the instructions from your broker or bank included with these proxy materials or contact your broker or bank to request a proxy form.

ADS Holders of Record

ADS holders as of the ADS record date (4:30 p.m. (U.S. Eastern Time) on April 25, 2022) who wish to exercise their voting rights for the underlying ordinary shares must act through Citibank. The deposit agreement permits registered ADS holders as of the ADS record date to instruct Citibank to exercise the voting rights for the ordinary shares represented by ADSs. Citibank has agreed that it will endeavor, insofar as practicable and permitted under applicable law and the provisions of the deposit agreement, to vote the securities (in person or by proxy) represented by the holder’s ADSs in accordance with such voting instructions as follows:

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In the event of voting by a show of hands, Citibank will vote (or cause its custodian to vote) all ordinary shares held on deposit at that time in accordance with the voting instructions received from a majority of ADS holders who provide timely voting instructions.

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In the event of voting by poll, Citibank will vote (or cause its custodian to vote) the ordinary shares held on deposit in accordance with the voting instructions received from ADS holders.

In the event of voting by poll, ADS holders of record that have not provided timely voting instructions shall be deemed to have instructed Citibank to give a discretionary proxy to a person designated by us to vote the ordinary shares represented by such holders’ ADSs; provided that no such instructions shall be deemed given and no such discretionary proxy shall be given with respect to any matter as to which we inform Citibank that we do not wish such proxy to be given; provided, further, that no such discretionary proxy shall be given (x) with respect to any matter as to which we inform Citibank that (i) there exists substantial opposition, or (ii) the rights of ADS holders or the shareholders of the Company will be materially adversely affected, and (y) in the event that the vote is by a show of hands.

Citibank will distribute information to ADS holders as of the ADS record date (4:30 p.m. (U.S. Eastern Time) on April 25, 2022) describing how voting instructions may be delivered to Citibank by ADS holders.

Instructions from the ADS holders must be sent to Citibank so that the instructions are received by no later than 10:00 a.m. (U.S. Eastern Time) on June 14, 2022.

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Beneficial Owners of ADSs

If you are a beneficial owner of ADSs registered on the ADS record date in the name of a brokerage firm, bank or other financial institution, you should have received information containing voting instructions from that organization rather than from Citibank. Simply follow the voting instructions to ensure that your vote is counted.

Conversion of ADSs

If a holder of ADSs cancels his, her or its ADSs in exchange for ordinary shares on or prior to the ADS record date, such holder of ADSs will not be able to instruct Citibank, as depositary of the ADSs, as to how to vote the ordinary shares represented by the canceled ADSs as described above. Holders of ADSs who wish to cancel their ADSs in exchange for ordinary shares for the purpose of voting the ordinary shares directly will need to make arrangements to deliver their ADSs to Citibank, as depositary of the ADSs, for cancellation with sufficient time to allow for the completion of the delivery and, if applicable, the re-registration of the ordinary shares on our Company’s register of members in Hong Kong prior to the ordinary share record date, together with (a) delivery instructions for the corresponding ordinary shares (including, if applicable, the name and address of person(s) who will be the registered holder of such ordinary shares) and (b) payment of the ADS depositary fees associated with such ADS cancellation (US$0.05 per ADS to be cancelled) and any applicable taxes. If ADSs are held in a brokerage firm, bank or other financial institution, please contact the broker, bank or other financial institution to find out what actions need to be taken to instruct the broker, bank or other financial institution to present the ADSs for cancellation. Please be aware that there are no guarantees of timely delivery or re-registration of ordinary shares prior to the record date due to the time differences between U.S. Eastern Time and Shanghai and Hong Kong Time, as well as the time required for processing the ADS cancellations, the delivery of our ordinary shares and, if applicable, the re-registration of our ordinary shares on the Company’s register of members in Hong Kong.

What are “broker non-votes”?

A “broker non-vote” occurs when a U.S. brokerage firm, bank or other financial institution holding shares for a beneficial owner of ordinary shares does not vote the shares on a proposal because the U.S. brokerage firm, bank or other financial institution does not have discretionary voting power for a particular item and has not received instructions from the beneficial owner regarding voting of their shares. U.S. brokerage firms, banks and other nominees who hold shares for the accounts of their clients have discretionary authority to vote shares if specific instructions are not given with respect to routine matters. Discretionary proxies exercised by U.S. brokerage firms, banks or other financial institutions with respect to our ADSs will be processed by Citibank in accordance with the provisions of the deposit agreement.

Brokerage firms, banks or other financial institutions holding shares for a beneficial owner of our ordinary shares listed for trading on the Hong Kong Stock Exchange and held in Central Clearing and Settlement System (“CCASS”) in Hong Kong do not have discretionary authority to vote shares if specific instructions are not given by the beneficial owner of the ordinary shares. Accordingly, if your shares listed for trading on the Hong Kong Stock Exchange are held by a brokerage firm, bank or other financial institution on your behalf in CCASS in Hong Kong and you do not instruct the brokerage firm, bank or other financial institution as to how to vote your shares, your brokerage firm, bank or other financial institution will not be entitled to exercise discretion to vote your shares.

How are votes counted?

Votes will be counted by the inspector of election appointed for the meeting. Consistent with the laws of the Cayman Islands, abstentions and broker non-votes will be counted for the purpose of determining the presence or absence of a quorum. If you return a signed and dated proxy card or otherwise vote without marking voting selections, your shares will be voted in accordance with the recommendation of the Board of Directors set forth above. Our shareholders have no rights under the Cayman Islands Companies Act or under our Fifth Amended

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and Restated Memorandum and Articles of Association (“Current Articles”) to exercise dissenters’ or appraisal rights with respect to the proposals being voted on.

Can I revoke or change my vote after I submit my proxy?

If you are the record holder of your shares, you may revoke your proxy in any one of the following ways:

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You may submit another properly completed proxy card with a later date.

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You may grant a subsequent proxy through the Internet.

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You may send a timely written notice that you are revoking your proxy to Zai Lab Limited, 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, Attention: Corporate Secretary.

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You may attend the Annual Meeting and vote electronically. Simply attending the Annual Meeting will not, by itself, revoke your proxy.

Your most current proxy card or Internet proxy is the one that is counted.

Will my shares be counted if I do not vote?

Your shares will not be voted at the Annual Meeting if you are the shareholder of record and you do not vote before the Annual Meeting by proxy card, or via the Internet, or during the Annual Meeting, in person or virtually via the Internet,.

What if I return my proxy card but do not provide voting instructions?

Abstentions and broker non-votes will be counted for the purpose of determining the presence or absence of a quorum, but will not be counted for the purpose of determining the number of votes cast on a given proposal. If you return a signed and dated proxy card or otherwise vote without marking voting selections, your shares will be voted in accordance with the recommendations of the Board of Directors set forth above.

What is the quorum requirement?

Pursuant to the Current Articles, the quorum required for a general meeting of shareholders consists of one or more shareholders holding not less than an aggregate of one-tenth of all voting share capital of the Company in issue who are present in person, virtually or by proxy and entitled to vote. As of the Ordinary Share record date, there were 979,087,430 shares outstanding and entitled to vote. Thus, the holders of 97,908,743 shares must be present in person or virtually or represented by proxy at the Annual Meeting to have a quorum. 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 electronically at the Annual Meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If there is no quorum, the holders of a majority of the shares present at the meeting or represented by proxy may adjourn the meeting to another date.

How many votes are needed to approve each proposal?

An ordinary resolution to be passed by the shareholders requires the affirmative vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person, virtually or by proxy at a general meeting, while a special resolution requires the affirmative vote of at least two-thirds of the votes cast by the shareholders entitled to vote who are present in person, virtually or by proxy at a general meeting. Proposals 1-9 and 11-15 of this Proxy Statement are ordinary resolutions. Proposal 10 of this Proxy Statement is a special resolution. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect on the results of this vote.

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Who is paying the expenses of solicitation?

We are making this solicitation and will pay the entire cost of preparing and distributing the proxy materials and soliciting votes. If you choose to access the proxy materials over the Internet, you are responsible for any Internet access charges that you may incur. Our officers, directors and employees may, without compensation other than their regular compensation, solicit proxies through further mailings, personal conversations, facsimile transmissions, emails or otherwise. Proxies may be solicited by telephone, email, facsimile, personal solicitation or otherwise. Proxy solicitation expenses that we will pay include those for preparation, mailing, returning and tabulating the proxies.

When are shareholder proposals and director nominations due for next year’s annual meeting?

The Cayman Islands Companies Act provides shareholders with only limited rights to requisition a general meeting and does not provide shareholders with a right to put any proposal before a general meeting. However, these rights may be provided in a company’s articles of association. The Current Articles allow our shareholders holding in aggregate not less than one-tenth of the share capital of the Company and entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders, in which case the Board of Directors may duly convene an extraordinary general meeting and submit the resolutions put forward to a vote at such meeting. As a Cayman Islands exempted company, we are not obligated by law to call annual general meetings, however, under the Current Articles, the Company shall hold an annual general meeting every year.

Shareholders may present proper proposals for inclusion in our proxy statement and for consideration at our next annual general meeting of shareholders by submitting their proposals in writing to us in a timely manner. In order to be considered for inclusion in the proxy statement for the 2023 annual general meeting of shareholders, shareholder proposals must be received at our principal executive offices no later than December 31, 2022, and must otherwise comply with the requirements of Rule 14a-8 of the Exchange Act. If a shareholder wishes to propose a person for election as a director of the Company at our next annual general meeting, such shareholder must lodge a written notice at our principal place of business, with a copy forwarded to our registered office. The period for lodgment of such notice shall be a period commencing on the day after the dispatch of the notice of such meeting and ending on the earlier of (i) seven (7) days after the date of such notice or (ii) seven (7) days prior to the date of such meeting (or such other period, being not less than seven (7) days, commencing no earlier than the day of dispatch of the notice of such meeting and ending no later than seven (7) days prior to the date appointed for such meeting, as may be determined by the Board from time to time). Such written notice must include the background information on the Candidate required by Rule 13.51(2) of the Listing Rules of the Hong Kong Stock Exchange. Any other shareholder proposal for the 2023 annual general meeting of shareholders which is submitted outside the processes of Exchange Act Rule 14a-8 (including a director nomination) shall be considered untimely unless received by the Company in writing no later than March 15, 2023. If the date of the annual general meeting is moved by more than 30 days from the date contemplated at the time of the previous year’s proxy statement, then notice must be received within a reasonable time before we begin to print and send proxy materials. If that happens, we will publicly announce the deadline for submitting a proposal in a press release or in a document filed with the SEC and announced in Hong Kong via the website of Hong Kong Exchange and Clearing Limited (www.hkexnews.hk). A copy of all notices of proposals by shareholders should be sent to Chief Legal Officer & Corporate Secretary, Zai Lab Limited, 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210.

When will the Company announce the voting results?

Results of the Annual Meeting will be posted on the website of the Company (https://www.zailaboratory.com/) and on the website of HKEx (www.hkexnews.hk) following the conclusion of the Annual Meeting and on the website of the SEC (www.sec.gov) in a Current Report on Form 8-K filed by us within four business days of the conclusion of the Annual Meeting.

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MATTERS REQUIRING SHAREHOLDER ACTION

PROPOSALS 1 TO 9

ELECTION OF DIRECTORS

Description of the Proposal

The Current Articles provide that unless otherwise determined by the Company in a general meeting, the authorized number of directors shall be not less than one or more than ten and each director shall be elected annually for terms expiring at the next annual meeting of the Company, at which he or she may be eligible for re-election, until his or her earlier death, resignation or removal. We are not subject to any contractual obligations regarding the election of our directors. Vacancies on the Board of Directors may be filled only by persons elected by a majority of the remaining directors. A director elected by the Board of Directors to fill a vacancy, including vacancies created by an increase in the number of directors, will serve for the remainder of the full term of that class and until the director’s successor is duly elected and qualified.

The Board of Directors presently has nine members, all of whom are up for re-election at the Annual Meeting. If elected at the Annual Meeting, each of these nominees would serve until the 2023 annual meeting and until his or her successor has been duly elected and qualified or, if sooner, until the director’s death, resignation or removal. Our policy is to encourage directors and nominees for director to attend our annual meetings. One of seven directors then in office attended the 2021 annual meeting.

The following table sets forth certain information as of April 1, 2022, with respect to our directors, all of whom are nominated for election by the Board of Directors at the Annual Meeting.


Name	Age	Position(s)	Director Since
Samantha (Ying) Du	57	Founder, Chief Executive Officer, Chairperson of the Board of Directors		2014
Richard Gaynor	72	Director		2021
Kaixian Chen	76	Director		2018
John D. Diekman	79	Director		2017
Nisa Leung	51	Director		2014
William Lis	57	Director		2018
Leon O. Moulder Jr.	64	Director		2020
Peter Wirth	71	Director		2017
Scott Morrison	64	Director		2021

Biographical information for directors as of April 1, 2021 are set forth below:

Samantha (Ying) Du, Ph.D.

Experience

Dr. Du founded Zai Lab in 2014 and has been our CEO and Chairperson of the Board of Directors since its inception. Prior to founding Zai Lab, Dr. Du spent two years at Sequoia Capital China where she led four healthcare investments and served on the boards. From 2001 to 2011, Dr. Du co-founded Hutchison MediPharma and Hutchison China MediTech and served as their Chief Executive Officer and Chief Scientific Officer, respectively, since their inception. Dr. Du began her research career with Pfizer in the United States from 1994 to 2001. She received her Ph.D. in biochemistry from the University of Cincinnati in 1994 and her bachelor’s degree in molecular biology from Jilin University, China in 1987.

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Skills and Qualifications

The Board of Directors believes that Dr. Du’s valuable knowledge with respect to the Company as its founder and Chief Executive Officer, significant knowledge and experience with respect to the biotechnology, healthcare and pharmaceutical industries and her comprehensive global leadership background resulting from extensive service as an executive in the pharmaceutical industry position her to make valuable contributions to the Board.

Richard Gaynor, M.D.

Experience

Dr. Gaynor has been our independent Director since November 2021 and currently serves as the Chairman of our Research and Development Committee. Dr. Gaynor is the President and Chief of Research and Development of BioNTech US. Prior to this, he was President, Research and Development, at Neon Therapeutics, beginning in 2016. Previously, Dr. Gaynor spent 15 years in senior roles at Lilly Oncology, including as Senior Vice President, Clinical Development and Medical Affairs. He chaired the Lilly Oncology Research and Development Committee and helped oversee collaborations with such companies as Bristol Myers Squibb, Merck, AstraZeneca and GE Healthcare. Dr. Gaynor also led preclinical and early clinical oncology research at Lilly. Dr. Gaynor holds an M.D. from the University of Texas Southwestern Medical School, where he served a residency in internal medicine. He completed fellowship training in hematology-oncology at the UCLA School of Medicine, where he spent nine years on the faculty. He then served for 11 years on the faculty at the University of Texas Southwestern Medical School, including as the Chief of Hematology-Oncology and Director of the Simmons Cancer Center. He is the author of nearly 150 publications. Dr. Gaynor participates on numerous advisory boards and committees, including currently serving as a Director of Alkermes, Infinity Pharmaceuticals and the Damon Runyon Cancer Research Foundation.

Skills and Qualifications

The Board of Directors believes that Dr. Gaynor’s deep experience as an oncologist and his expertise in research and development position him to make valuable contributions to the Board.

Kai-Xian Chen, Ph.D.

Experience

Professor Chen has been our independent Director since August 2018. Professor Chen has been serving as the independent non-executive Director of InnoCare Pharma Limited since March 2020. He has also been serving as the independent Director of Jiangsu Kanion Pharmaceutical Co., Ltd. since December 2019 and the independent non-executive Director of Innovent Biologics, Inc. since October 2018. From 2007 to 2017, he served as a member of the National Committee of the Chinese People’s Political Consultative Conference. From 2005 to 2014, Professor Chen served as President of Shanghai University of Traditional Chinese Medicine. From 2011 to 2018, Professor Chen served as President of the Shanghai Association for Science and Technology. Prior to that, from 1993 to 2004, Professor Chen served as Deputy Director and later, Director of Shanghai Institute of Materia Medica (“SIMM”) Chinese Academy of Sciences. Professor Chen has also served as Principal Scientist for two National Basic Research Programs by the MOST. Since 2001, Professor Chen has served successively as the member of the Chief Specialists Board and the Deputy Chief Technical Officer of the major science and technology projects “innovative drugs and modernization of traditional Chinese medicine” and “Innovative Drug Research & Development,” where he participated in the organization and promotion of new drug research and development for China’s 10th -13th Five Year Plans. In 1999, Professor Chen was elected as a member of the Chinese Academy of Sciences. Prior to that, from 1985 to 1988, he conducted postdoctoral research at Institut de Biologie Physico-Chimique in Paris. Professor Chen started his academic career at SIMM as an Associate Professor, where he later reached the level of Full Professor. Professor Chen received his Master and Ph.D. degree at the Chinese Academy of Science in 1982 and 1985 respectively and his Bachelor of Science from Fudan University in 1967.

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Skills and Qualifications

The Board of Directors believes that Professor Chen’s service as a member of several prestigious Chinese institutional and research organizations, in addition to his service as an independent director for biopharmaceutical companies, position him to make valuable contributions to the Board.

John D. Diekman, Ph.D.

Experience

Dr. Diekman has been our independent Director since 2017 and currently serves as the Chairman of our Audit Committee. Dr. Diekman is founding partner of 5AM Ventures, where he has served since 2002. He is director of Cleave Therapeutics, Inc., a cancer therapeutic company; and Wildcat Discovery Technologies, Inc., a technology company that discovers materials for energy storage applications; charter trustee of Princeton University; chairman of the board of directors of The Scripps Research Institute; and a member of the advisory board of the Schaeffer Center for Health Policy and Economics at the University of Southern California. During the last five years, Dr. Diekman served as the Chairman and Director of IDEAYA Biosciences from 2015 to June 2020. Dr. Diekman holds an A.B. in Organic Chemistry from Princeton University in 1965 and a Ph.D. in Chemistry from Stanford University in 1969.

Skills and Qualifications

The Board of Directors believes that Dr. Diekman’s expertise, perspective and experience as a founder and director at oncology-focused companies as well as his expertise in life sciences and venture capital industries, position him to make valuable contributions to the Board.

Nisa Leung

Experience

Nisa Leung has been our Director since 2014 and independent director since July 2020. Ms. Leung is a Managing Partner at Qiming Venture Partners, where she leads its healthcare investments. In addition to serving on the Board of Directors, Ms. Leung is also a member of the board of directors of CanSino Biologics Inc., a vaccine developer; dMed, a Shanghai-based CRO consulting startup; and Venus Medtech, a developer of interventional artificial cardiac valve systems. Ms. Leung received a Master of Business Administration from the Stanford Graduate School of Business in June 2001 and a B.S. in Hotel Administration from Cornell University in 1992.

Skills and Qualifications

The Board of Directors believes that Ms. Leung’s venture capital and consulting experience in the healthcare industry, position her to make valuable contributions to the Board.

William Lis

Experience

Mr. Lis has been our independent Director since October 2018. He has 30 years of biopharmaceutical experience. He is the Chairman after serving as CEO of Jasper Therapeutics, Inc. where he led the company’s 2019 Series A financing, initial public offering and pipeline development from 2019 until 2022. Previously, Mr. Lis served as Chief Executive Officer and a Director of Portola Pharmaceuticals, Inc. from 2009 until 2018 after serving as Chief Operating Officer. Under his leadership, Portola successfully grew from a discovery-stage company to a fully integrated research and development and commercial organization, and independently discovered and developed Andexxa^®, Bevyxxa^® and cerdulatinib. He led the initial public offering in 2013 and grew Portola into

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a multi-billion dollar valuation company during his tenure. Portola was acquired by Alexion in 2020. Mr. Lis held executive positions at Scios, Inc. (a Johnson & Johnson company) where he last served as Sr. Vice President of New Product Development and Business Development, having led in-licensing efforts, development and the commercial operations for Xarelto^®; He also held positions of increasing responsibility at Millennium Pharmaceuticals, Inc. (previously COR Therapeutics, Inc.) and Rhone Poulenc Rorer in sales, marketing, medical affairs and business development. he was involved in the commercial launch of Integrilin^®, Lovenox^®, Velcade^® and Rilutek^®. Mr. Lis served as a member of the Bio Board of Directors for Emerging Companies and as an independent Director of Eidos Therapeutics, Inc (Nasdaq: EIDX), acquired by Bridge Bio. Mr. Lis holds a B.S. from the University of Maryland.

Skills and Qualifications

The Board of Directors believes that Mr. Lis’ extensive leadership and financial experience in the biopharmaceutical industry position him to make valuable contributions to the Board.

Leon O. Moulder, Jr.

Experience

Mr. Moulder has been our independent Director since January 2020 and currently serves as the Chairman of the Nominating and Corporate Governance Committee. Mr. Moulder is the Managing Member of Tellus BioVentures, LLC, an early-stage life sciences investment fund. He most recently served as Chief Executive Officer and Director of Tesaro, Inc. since cofounding the company in 2010. Acquired by GSK in January 2019, Tesaro was a fully-integrated Boston based oncology-focused biopharmaceutical company with operations in North America and Europe. He previously served as President and Chief Executive Officer of Abraxis BioScience, Inc., prior to the company’s eventual acquisition by Celgene Corporation in 2010. Prior to that, from 2008, Mr. Moulder served as Vice Chairman of Eisai Corporation of North America following Eisai’s acquisition of MGI PHARMA, where he served as President and Chief Executive Officer beginning in 2003 and previously as Executive Vice President since 1999. This followed him serving as a member of the founding management team of a venture-stage biotech company in 1997. Mr. Moulder began his career as a clinical pharmacist followed by a seventeen-year career at predecessor companies of Sanofi, beginning with Marion Laboratories in 1981. Mr. Moulder is a Temple University Trustee, Chairman of the Trustee Committee for Research, Chairman of the Temple University Japan (TESS) Board and serves on the board of the Fox Chase Cancer Center. He is a Council Member for both the University of Chicago Booth School of Business and the Polsky Center for Entrepreneurship and Innovation. Mr. Moulder serves on the board of the Helsinn Group, is Chairman of the Board of Directors of Trevena, Inc. and previously served on the Boards of Cubist Pharmaceuticals and the Biotechnology Innovation Organization (BIO). Mr. Moulder received a Pharmacy degree from Temple University in 1980 and an MBA from The University of Chicago Booth School of Business in 1997.

Skills and Qualifications

The Board of Directors believes that Mr. Moulder’s significant operational and senior management experience in the biopharmaceutical industry, as well as his extensive experience as a director on public and private boards in the industry, position him to make valuable contributions to the Board.

Peter Wirth

Experience

Mr. Wirth has been our Director since 2017, and independent Director since May 2020 and currently serves as the Chairman of the Compensation Committee. He is a venture partner at Quan Capital Management, LLC, a global venture capital firm; chairman of the board of directors of FORMA Therapeutics, a Nasdaq-listed clinical stage biopharmaceutical company developing novel therapeutics for patients with rare hematological diseases

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and cancer; and chairman of the board of directors at Syros Pharmaceuticals, a Nasdaq-listed clinical stage biopharmaceutical company developing novel therapeutics for patients with leukemia and select solid tumors. From 2011 to 2014, Mr. Wirth served as Founder, President and Director of Lysosomal Therapeutics, Inc., a biopharmaceutical company focused on small molecule research and development in the field of neurodegeneration. From 1996 to 2011, Mr. Wirth served as a senior executive at Genzyme, which is now part of Sanofi, and most recently as its Executive Vice President of legal and corporate development, Chief Risk Officer and corporate secretary. Mr. Wirth received a B.A. in Political Science from the University of Wisconsin at Madison in 1972 and a JD from Harvard Law School in 1975.

Skills and Qualifications

The Board of Directors believes that Mr. Wirth’s expertise in corporate governance and his experience in corporate strategy, product development, business development and legal issues confronting the biotechnology industry position him to make valuable contributions to the Board.

Scott Morrison

Experience

Mr. Morrison has been our independent Director since October 2021. He has served public and private companies in the life sciences industry since 1980. He was a Partner with Ernst & Young LLP from 1996 to December 2015, serving as its U.S. Life Sciences Leader from 2002 to December 2015. During his tenure at EY he worked on hundreds of public and private financings, M&A transactions and corporate collaborations. Mr. Morrison retired in December 2015 and now serves on the boards and chairs the Audit Committees of Audentes, Inc. (through its sale to Astellas in January 2020), Corvus Pharmaceuticals, Global Blood Therapeutics, IDEAYA Biosciences and Vera Therapeutics. He also serves as a member of the Compensation Committee for GBT and Corvus and is a member of the GBT’s Commercial Committee. Mr. Morrison has also served as a director on several life sciences industry boards including the Biotechnology Innovation Organization (BIO) ECS board, the Bay Area Biosciences Board (now CLSA), the Life Sciences Foundation and the Biotechnology Institute. Mr. Morrison was awarded the CLSA Pantheon 2016 Life Sciences Leadership Award. Mr. Morrison holds a B.S. in Business Administration from the Haas School at University of California, Berkeley and is a Certified Public Accountant (inactive).

Skills and Qualifications

The Board of Directors believes that Mr. Morrison’s positions on other boards, experience in the life science industry and financial expertise position him to make valuable contributions to the Board.

Vote Required

Each director nominated for election will be elected if a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy vote in favor of such director. Broker non-votes and abstentions with respect to one or more directors will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the election.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES LISTED ABOVE.

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PROPOSAL 10

ADOPTION OF THE SIXTH AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION, CONDITIONED AND EFFECTIVE UPON THE EFFECTIVE DATE OF THE COMPANY’S CONVERSION TO DUAL-PRIMARY LISTING ON THE HKEX

Description of the Proposal

General

The Board of Directors has approved, declared advisable and is recommending that our shareholders approve the Sixth Amended and Restated Memorandum and Articles of Association of the Company (the “Sixth Articles”) to replace the Fifth Amended and Restated Memorandum and Articles of Association (the “Current Articles”) at the Annual Meeting, conditioned on and subject to the Company’s conversion to dual primary listing status on the Main Board of the Stock Exchange of Hong Kong Limited (the “HKEx”), to reflect changes required or recommended by the HKEx in connection with the Company’s conversion to dual primary listing status on the HKEx and the recent share subdivision approved by shareholders in March 2022. Details of the proposed amendments to the Current Articles are set out below. The following discussion is qualified in its entirety by reference to the proposed Sixth Articles, a copy of which is attached to this Proxy Statement as Appendix A and is incorporated herein by reference. Appendix A is marked to show the proposed changes that would be made.

Background

The Board of Directors approved a preliminary proposal for the dual-primary listing of the Company’s ordinary shares on the Main Board of The Stock Exchange of Hong Kong Limited and the Nasdaq Stock Market. In order to comply with the HK Listing Rules as described in this Proxy Statement, the Company has proposed to amend certain provisions of the Current Articles to reflect changes required or recommended by the HKEx in connection with the Company’s conversion to dual primary listing status on the HKEx and the share subdivision.

The Current Articles are available on the websites of the Company (www.zailaboratory.com) and Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk).

Description and Purpose of the Restated Articles

Special Resolution – Article 1

If this proposal is approved, the Current Articles will be amended and restated to vary the definition of a Special Resolution to specifically make reference to, and include, instances flagged in the Sixth Articles that require the increased voting threshold (from two-thirds to three-fourths of the votes cast on a proposal) of a “Super-Majority Resolution” (as defined below). This proposed amendment is made in compliance with the Companies Act (Revised) of the Cayman Islands, which provides at Section 60(1)(a) that a company may in its articles of association specify that the required majority shall be a number greater than two-thirds, and may additionally so provide that any such majority (being not less than two-thirds) may differ as between matters required to be approved by a special resolution.

Variation of Rights Attaching to Shares – Article 23

If this Proposal is approved, the Current Articles will be amended and restated to increase the voting threshold for the variation of rights attaching to any class or series of shares by written consent from two-thirds of the issued shares to three-fourths of the voting rights of the holders of that class or series, and that such variation of rights can also be approved by a not less than three-fourth of our shareholders (“Super-Majority Resolution”), who, as being entitled to do so, vote at a general meeting, the quorum of which is not less than an aggregate of one-third of the issued shares of the relevant class. This proposed amendment is made in compliance with

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paragraph 15 of Appendix 3 of the HK Listing Rules, which provides that a super-majority vote of the issuer’s members of the class to which the rights are attached shall be required to approve a change to those rights. For the purpose of this HK Listing Rule, a “super-majority vote” means at least three-fourths of the voting rights of the members holding shares in that class present and voting in person or by proxy at a separate general meeting of members of the class where the quorum for such meeting shall be holders of at least one third of the issued shares of the class.

Quorum – Article 24(b)

If this Proposal is approved, the Current Articles will be amended and restated to increase the necessary quorum to hold a general meeting of holders of one class or series of shares or to demand a poll at such a general meeting from one or more persons holding or representing at least one-tenth of the issued shares of that class or series to one or more persons holding or representing at least one-third of the issued shares of that class or series. This proposed amendment is made in compliance with paragraph 15 of Appendix 3 of the HK Listing Rules, which provides that a super-majority vote of the issuer’s members of the class to which the rights are attached shall be required to approve a change to those rights and which a quorum for such meeting shall be holders of at least one third of the issued shares of that class. If this Proposal is approved, language relating to the right of members to demand a poll within Article 24(b) will also be removed (as explained below).

Shareholder Right to Speak at General Meeting – Articles 52-54, 58, 71

If this Proposal is approved, the Current Articles will be amended and restated to explicitly specify that each shareholder of the Company entitled to attend or vote at a general meeting shall also have the right to speak at the general meeting. This proposed amendment is made in compliance with paragraph 14(3) of Appendix 3 of the HK Listing Rules, which provides that members must have the right to speak at a general meeting; and vote at a general meeting except where a member is required, by the HK Listing Rules, to abstain from voting to approve the matter under consideration.

General Meetings – Article 56(a)

If this Proposal is approved, the Current Articles will be amended and restated to provide that the annual general meeting of the Company shall occur within 6 months after the end of the Company’s financial year (or such longer period as the relevant stock exchange may authorize). This proposed amendment is made in compliance with paragraph 14(1) of Appendix 3 of the HK Listing Rules, which provides that an issuer must hold a general meeting for each financial year as its annual general meeting and generally, an issuer must hold its annual general meeting within six months after the end of its financial year.

Notice of General Meetings – Article 58

If this Proposal is approved, the Current Articles will be amended and restated to provide that the notice period for any extraordinary general meeting of the Company will be at least 14 calendar days and the notice period for any annual general meeting of the Company will be at least 21 calendar days. This proposed amendment is made in compliance with paragraph 14(2) of Appendix 3 of the HK Listing Rules.

Voting by poll at General Meetings – Articles 24(b), 66-69, 77 and 78

If this Proposal is approved, the Current Articles will be amended and restated to provide that voting on a resolution at a general meeting shall be decided by poll, rather than a show of hands, save for matters that the Chairperson of the meeting may, in good faith, deem to be matters that are purely administrative or procedural and were not on the agenda of the meeting or any supplementary circular to members, and therefore may put such matter to vote by a show of hands. These proposed amendments are made in compliance with Rule 13.39(4) of the HK Listing Rules.

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Clearing Houses – Article 81A

If this Proposal is approved, the Current Articles will be amended and restated to provide that the Hong Kong Securities Clearing Company Limited (“HKSCC”) will be entitled to appoint proxies or corporate representatives to attend the Company’s general meetings and creditors meetings and such proxies or corporate representatives will enjoy rights equivalent to the rights of other shareholders of the Company, and that, where applicable law prohibits HKSCC form appointing proxies or corporate representatives, the Company will use its best efforts to make necessary arrangements with HKSCC to ensure that Hong Kong investors holding shares through HKSCC enjoy the right to vote, attend and speak at general meetings. This proposed amendment is made in compliance with paragraph 19 of Appendix 3 of the HK Listing Rules, which provides that HKSCC must be entitled to appoint proxies or corporate representatives to attend the issuer’s general meetings and creditors meetings and those proxies/corporate representatives must enjoy rights equivalent to the rights of other shareholders, including the right to speak and vote.

Directors – Article 82(d)

If this Proposal is approved, the Current Articles will be amended and restated to specify within this Article that directors appointed by ordinary resolution to fill a casual vacancy on the board or as an addition to the existing board will hold office until the first annual general meeting of the Company after his appointment and will then be eligible for re-election at that meeting. This proposed amendment is made in compliance with paragraph 4(2) of Appendix 3 of the HK Listing Rules, which provides that any person appointed by the directors to fill a casual vacancy on or as an addition to the board shall hold office only until the first annual general meeting of the issuer after his appointment, and shall then be eligible for re-election.

Proceedings of Directors – Article 103(a)

If this Proposal is approved, the Current Articles will be amended and restated to provide that at least 14 calendar days’ notice shall be given to all directors and their respective alternates for regular board meetings. This proposed amendment is made in compliance with Code Provision C.5.3 of Appendix 14 of the HK Listing Rules, which provides that notice of at least 14 days should be given of a regular board meeting to give all directors an opportunity to attend. For all other board meetings, reasonable notice should be given.

Proceedings of Directors – Article 108

If this Proposal is approved, the Current Articles will be amended and restated to specify that a Director’s vote with respect to any matter that he may be interested in shall be subject to the relevant rules of the designated stock exchange.

Audit – Article 134

If this Proposal is approved, the Current Articles will be amended and restated to provide that the appointment and removal of an auditor of the Company shall be approved by a majority of the shareholders of the Company or other body that is independent of the Board of Directors in accordance with the HK Listing Rules, that the removal of an auditor of the Company before the expiration of its period of office shall require the approval of an ordinary resolution, and that the remuneration of the auditor of the Company shall be approved by a majority of the shareholders of the Company or other body that is independent of the Board. This proposed amendment is made in compliance with paragraph 17 of Appendix 3 of the HK Listing Rules, which provides that the appointment, removal and remuneration of auditors must be approved by a majority of the issuer’s members or other body that is independent of the board of directors.

Information – Article 150

If this Proposal is approved, the Current Articles will be amended and restated to provide that any branch Register of Members maintained in Hong Kong shall be open for inspection by a shareholder of the Company

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without charge, and shall be open to such other persons on payment of a fee as the Board may determine, subject to certain limitations, and that the Company may be permitted to close the branch Register of Members on terms equivalent to Section 632 of Companies Ordinance (Cap. 622 of the Laws of Hong Kong). This proposed amendment is made in compliance with paragraph 20 of Appendix 3 of the HK Listing Rules, which provides that the branch register of members in Hong Kong shall be open for inspection by members but the issuer may be permitted to close the register on terms equivalent to section 632 of the Companies Ordinance (Cap. 622 of the Laws of Hong Kong).

Winding Up – Article 155

If this Proposal is approved, the Current Articles will be amended and restated to provide that the Company may be wound up voluntarily if the shareholders of the Company at any general meeting so resolve by Super-Majority Resolution. This proposed amendment is made in compliance with paragraph 21 of Appendix 3 of the HK Listing Rules, which provides that a super-majority vote of the issuer’s members in a general meeting shall be required to approve a voluntary winding up of an issuer.

Amendment to Memorandum and Articles – Article 155

If this Proposal is approved, the Current Articles will be amended and restated to provide that the Company’s memorandum of association and articles of association may be altered or amended, or the name of the Company may be changed, if the shareholders of the Company at any general meeting so resolve by Super-Majority Resolution. This proposed amendment is made in compliance with paragraph 16 of Appendix 3 of the HK Listing Rules, which provides that a super-majority vote of the issuer’s members in a general meeting shall be required to approve changes to an issuer’s constitutional documents. For the purpose of this HK Listing Rule, a “super-majority vote” means at least three-fourth of the voting rights of the members present and voting in person or by proxy at the general meeting.

General Effects of the Restated Articles

If the shareholders of the Company approve the Sixth Articles, the Sixth Articles will become effective upon the effective date of the Company’s conversion to dual-primary listing on the HKEx, and will thereafter be filed with the Cayman Islands Registrar of Companies.

Vote Required

This Proposal requires the affirmative vote of two-thirds of the votes cast by the shareholders entitled to vote who are present in person, virtually or by proxy at the Annual Meeting. Abstentions and broker non-votes will have no effect on this vote.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ADOPTION OF THE SIXTH ARTICLES, CONDITIONED AND EFFECTIVE UPON THE EFFECTIVE DATE OF THE COMPANY’S CONVERSION TO DUAL-PRIMARY LISTING ON THE HKEX.

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PROPOSAL 11

APPROVAL OF THE ZAI LAB LIMITED 2022 EQUITY INCENTIVE PLAN, CONDITIONED ON AND SUBJECT TO THE DUAL-PRIMARY LISTING OF THE COMPANY ON THE MAIN BOARD OF THE STOCK EXCHANGE OF HONG KONG LIMITED BECOMING EFFECTIVE

Description of the Proposal

Overview

On April 20, 2022 (U.S. Eastern Time), the Board of Directors approved the Zai Lab Limited 2022 Equity Incentive Plan (the “2022 Plan”), conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective and shareholder approval, and subject to the granting of the waiver on Note 1 to Rule 17.03(9) of the HK Listing Rules by The Stock Exchange of Hong Kong Limited. The 2022 Plan is intended to replace the Zai Lab Limited 2017 Equity Incentive Plan (the “2017 Plan”) and is substantially similar to the 2017 Plan, but reflects changes (i) to increase the number of shares reserved for issuance under our equity incentive plans, (ii) required or recommended by the HKEx in connection with the Company’s conversion to dual primary listing status on the HKEx, (iii) in connection with the recent share subdivision approved by the Company’s shareholders and effected as of March 30, 2022 and (iv) in connection with updates to Internal Revenue Code (as defined below). At the time our Board approved the 2022 Plan, the Board determined that, if the 2022 Plan were approved by the shareholders and becomes effective following the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective, no new grants would be made under the 2017 Plan or the Zai Lab Limited 2015 Omnibus Equity Incentive Plan (the “2015 Plan”). Awards already granted under the 2017 Plan or the 2015 Plan will remain in full force and effect pursuant to the terms and conditions of the 2017 Plan and 2015 Plan, respectively, as if the 2017 Plan and 2015 Plan had not been amended or terminated. The 2022 Plan will be subject to the requirements under Chapter 17 of the HK Listing Rules.

Similar to the 2017 Plan, the 2022 Plan was designed to enhance the flexibility of the Compensation Committee of the Board of Directors in granting share options and other awards to our (and our subsidiaries’) officers, employees, non-employee directors and consultants and to allow us to continue to grant share options and other awards to such persons at levels determined to be appropriate by our Compensation Committee. The Board of Directors believes that share options and other share-based incentive awards play an important role in our success by encouraging and enabling our (and our subsidiaries’) employees, officers, non-employee directors and consultants upon whose judgement, initiative and efforts we largely depend for the successful conduct of our business. The Board of Directors anticipates that providing such persons with a direct equity stake in our Company will result in a closer alignment of the interests of such individuals with those of our Company and our shareholders, thereby stimulating their efforts on our behalf and strengthening their desire to remain with our Company. The Company acknowledges that there are persons other than officers, employees and directors who may contribute to us that can be eligible to the share options. Since our consultants and advisers have provided, or may provide, valuable services and advice to us, and such services and advice are related to our core business and are material to the long term development of the Company, the Board of Directors considers that they can be eligible to the share options in light of such services. This will allow the Company the flexibility to provide incentives to such eligible persons who will contribute their knowledge, experience and expertise to us. In assessing the eligibility of these persons, the Board of Directors will take into account a wide range of factors, including but not limited to, their potential and/or actual contribution to our business, the quality of the services provided, the scale of their business involvements or dealings with us, the length of the respective business relationships between them and us and the benefits and positive impacts they have brought about to our business development.

If the 2022 Plan is approved by our shareholders, the Company will make an application to the HKEx for the listing of the additional shares that will be issued under the 2022 Plan. If the 2022 Plan is not approved by our shareholders or if the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited does not become effective, share options and other awards will continue to be granted under the 2017 Plan .

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Key Features of the 2022 Plan

While the Board of Directors is aware of and has considered the potential dilutive effect of additional awards and option grants, it also recognizes the performance and motivational benefits of equity compensation and believes that the 2022 Plan is consistent with our executive compensation philosophy and the compensatory practices of other biotechnology companies in our peer group. The 2022 Plan contains a number of features that are designed to serve our shareholders’ interests and to reflect corporate governance best practices, including:

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Pool Size. The aggregate number of shares that may be delivered in satisfaction of awards under the 2022 Plan is 97,908,743 shares, which represented 10% of the issued share capital of the Company as of April 25, 2022, provided that the number of ordinary shares which may be issued upon exercise of all share options to be granted under the 2022 Plan shall not in aggregate exceed 10% of the issued share capital of the Company as of June 22, 2022. Subject to certain limitations, (1) the ordinary shares underlying any awards other than share options that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, reacquired by us prior to vesting, satisfied without any issuance of ordinary shares, or are otherwise terminated (other than by exercise) under the 2022 Plan, and (2) the ordinary shares underlying any share options that are lapsed, will be added back to the ordinary shares available for issuance under the 2022 Plan.

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No “Evergreen” Provision. The 2022 Plan does not include an “evergreen” feature, a feature which was included in the 2017 Plan and that provided for an automatic annual increase to the number of shares reserved under the 2017 Plan between January 1, 2018 and January 1, 2027 equal to the lesser of 4% of the number of shares outstanding as of the close of business on the immediately prior December 31st or such number as approved by the Board on or prior to such date each year.

•

Term of the Plan. The term of 2022 Plan will expire ten years from the date of adoption.

•

Maximum Limit of Shares Issuable Upon Vesting or Exercise of Outstanding Options. At any time, the maximum number of shares which may be issued and/or transferred upon the vesting or exercise of all outstanding options which have been granted and have yet to vest or be exercised under the 2022 Plan and any outstanding options granted under any other share award schemes of the Company shall not exceed 30% of the Company’s outstanding shares from time to time.

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Determination of Exercise Price. The exercise price of any option grants under the 2022 Plan will be, unless otherwise required by applicable law or regulation, (i) the higher of (x) the per-share closing price of the Company’s ADS on Nasdaq on the date of grant, which must be a Nasdaq trading day; and (y) the average per-share closing price of the Company’s ADSs on Nasdaq for the five Nasdaq trading days immediately preceding the date of grant, in each case of (x) and (y), multiplied by the applicable conversion ratio from an ADS to ordinary shares or (ii) in the event that no share or ADS is traded on a national securities exchange, the fair market value of a share determined by the administrator consistent with the rules of Section 422 and Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”) to the extent applicable, or such higher amounts as the Compensation Committee may determine in connection with the grant. Note (1) to Rule 17.03(9) of the HK Listing Rules, which states that the exercise price of an option must be at least the higher of: (i) the closing price of the securities as stated in daily quotations sheet of The Stock Exchange of Hong Kong Limited on the date of grant, which must be a business day; and (ii) the average closing price of the securities as stated in the daily quotations sheets of The Stock Exchange of Hong Kong Limited for the five business days immediately preceding the date of grant. The Company is applying for a waiver from strict compliance with Note (1) to Rule 17.03(9) of the HK Listing Rules so that the exercise price of the options will be determined based on the higher of; (i) the per-share closing price of the Company’s ADSs on Nasdaq on the date of grant, which must be a Nasdaq trading day; and (ii) the average per-share closing price of the Company’s ADSs on Nasdaq for the five Nasdaq trading days immediately preceding the date of grant, in each case of (i) and (ii), multiplied by the applicable conversion ratio from an ADS to ordinary share. Such waiver may or may not be granted by The Stock Exchange of Hong Kong Limited.

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•

Maximum Individual Limit. Unless approved by the Company’s shareholders, in accordance with the HK Listing Rules and the terms of the 2022 Plan, the total number of ordinary shares issued and to be issued upon the exercise of share options granted under the 2022 Plan and any other plan of the Company to an individual grantee within any 12-month period shall not exceed 1% of the ordinary shares in issue at the date of any such grant.

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Maximum Award Limit to Directors. The maximum value of all awards granted under the 2022 Plan to any director in any calendar year, assuming a maximum payout, shall not exceed (a) in the case of a newly appointed Director, $750,000 in the first year of his or her appointment, or otherwise (b) $500,000, in each case provided that such limit shall not apply to any award granted pursuant to a director’s initial equity grant in accordance with the Company’s Non-Employee Director Compensation Policy or election to receive an award in lieu of cash retainer or other fees.

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Mandatory Blackout Periods. The Company will not offer or grant awards during specified blackout periods, in accordance with HK Listing Rules.

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Share Option Term and Cancellation. The term of each share option shall be fixed by the administrator, and no share option shall be exercisable more than ten years after the date the share option is granted. The administrator shall also determine the time or times at which an award vests or becomes exercisable and the terms (including performance criteria to be satisfied) on which a share option remains exercisable. Unless otherwise determined by the administrator, a grantee is not required to achieve any performance target before the share options can be exercised. Any share option granted but not exercised by the end of its option term will automatically lapse and be cancelled.

The Directors are of the view that the flexibility given to the administrator to set the terms and conditions in the grant of options (such that the minimum period of options to be held, the performance targets to be achieved and the exercise price of options) for each grant will help to motivate the participants to make continued contributions to the Company and its subsidiaries, which serves the purpose of the 2022 Plan.

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Flexibility in designing equity compensation schemes. The 2022 Plan allows us to provide a broad array of equity incentives, including awards of share options, share appreciation rights, restricted shares, restricted share units, performance-based awards, unrestricted shares, dividend equivalent rights, and cash-based awards.

•

Repricing is not allowed. The exercise price of share appreciation rights will not be decreased in any manner without shareholder approval, except in connection with a corporate transaction involving the Company. In the case of share options, adjustment of the exercise price or the number of shares subject to share options already granted can only be made in the event of a capitalization issue, rights issue, sub-division or consolidation of shares or reduction of capital).

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No Current Dividends Paid for Unearned Performance-Based Awards. Dividends or dividend equivalents payable in connection with performance-based awards are subject to the same restrictions and risk of forfeiture as the underlying award. In this regard, we note that we currently do not pay dividends and do not anticipate doing so in the foreseeable future.

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Broad-based eligibility for equity awards. We grant equity awards to a majority of our employees. By doing so, we align our employees’ interests with shareholder interests and motivate our employees to act as owners of the business.

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Rights of holders of share option. Any holder of share options shall have the rights of a shareholder only as to shares acquired upon exercise of a share option and not as to unexercised share options. Accordingly, such holder shall not have any voting rights, or rights to participate in any dividends or distributions (including those arising on a liquidation of the Company) declared or recommended or resolved to be paid to the shareholders on the register of members of the Company on a date prior to the name of such holder being registered on such register.

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•

Transferability. The administrator may permit the transfer of awards other than ISOs or other share options, subject to applicable securities and other laws and such limitations as the administrator may impose. A share option shall be personal to the grantee and shall not be assignable and transferable.

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Cancellation of share options. The administrator may at any time cancel share options previously granted to, but not yet exercised by a participant to whom the share option was granted. Where the Company cancels share options and offers share options to the same participant, the offer of such new share options may only be made with available share options to the extent not yet granted (excluding the cancelled share options) within the limit approved by the shareholders of the Company.

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Amendment and termination. The administrator may at any time or times amend the 2022 Plan or any outstanding award for any purpose which may at the time be permitted by applicable laws, and may at any time terminate the 2022 Plan as to any future grants of awards; provided, however, that except as otherwise expressly provided in the 2022 Plan the administrator may not, without the participant’s consent, alter the terms of an award so as to affect materially and adversely the participant’s rights under the award, unless the administrator expressly reserved the right to do so at the time the award was granted. Any amendments to the 2022 Plan will be conditioned upon shareholder approval only to the extent, if any, such approval is required by applicable laws (including the specific provisions of the 2022 Plan which relate to the matters set out in Rule 17.03 of the HK Listing Rules), as determined by the administrator. To the extent required under the rules of any securities exchange or market system on which the shares are listed, amendments to the terms of the 2022 Plan and the terms of the share options granted under the 2022 Plan shall be subject to approval by the Company’s shareholders entitled to vote at a meeting of shareholders. The powers and authority of the Board or administrator of the 2022 Plan in relation to the alteration of any terms of the 2022 Plan shall not be changed except with prior sanction of a resolution of the Company in general meeting. In the event the 2022 Plan is terminated while any Share Option remains outstanding and unexercised, the provisions of the 2022 Plan shall remain in full force to the extent necessary to give effect to the exercise of any such share option. Any amended terms of the 2022 Plan must still comply with the relevant requirements under Chapter 17 of the Listing Rules.

There is no trustee appointed for the 2022 Plan. In the event that a trustee is to be appointed, the Company will ensure that no Director will become such a trustee or has any direct or indirect interest in such a trustee.

This summary is subject to the specific provisions contained in the full text of the 2022 Plan set forth in Appendix B to this Proxy Statement.

Other Features of the 2022 Plan

The 2022 Plan provides us with flexibility to issue various equity-based incentive awards, as described below, to motivate and retain our workforce. The ordinary shares we issue pursuant to awards granted under the 2022 Plan are authorized but unissued ordinary shares or ordinary shares that we reacquire.

The 2022 Plan is administered by the Compensation Committee. The Compensation Committee has full power to select, from among the individuals eligible for awards, the individuals to whom awards will be granted, to make any combination of awards to these selected individuals, and to determine the specific terms and conditions of each award, subject to the provisions of the 2022 Plan. Employees, directors and consultants as selected from time to time by the Compensation Committee are eligible to participate in the 2022 Plan. As of April 1, 2022, 8 non-employee directors and approximately 1999 employees and 30 consultants would be eligible to participate in the 2022 Plan. The Compensation Committee may delegate to the chairman of the Compensation Committee all or part of the Compensation Committee’s authority and duties with respect to granting awards and to our chief executive officer or chief financial officer the authority to grant awards to employees who are not subject to the reporting and other provisions of Section 16 of the Exchange Act.

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Under the 2022 Plan, the Compensation Committee may award share options, share appreciation rights, restricted shares, restricted share units, performance-based awards, unrestricted shares, dividend equivalent rights, and cash-based awards subject to such conditions and restrictions as it may determine. The Compensation Committee may also grant dividend equivalent rights that entitle the recipient to receive credits for dividends that would be paid if the recipient held a specified number of ordinary shares.

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Share Options and SARs. The Compensation Committee may grant share options, including incentive stock options (ISOs) and share appreciation rights (SARs). A share option is a right entitling the holder to acquire shares upon payment of the applicable exercise price. A SAR is a right entitling the holder upon exercise to receive an amount (payable in cash or shares of equivalent value) equal to the excess of the fair market value of the shares subject to the right over the base value from which appreciation is measured. The per shares exercise price (or the base value from which the appreciation is measured of each award requiring exercise, (A) in the case of a share option, must be no less than the fair market value of a share on the date of grant; and (B) in the case of certain ISOs, no less than 110% of the fair market value of the shares subject to the award. The fair market value means that as of a particular date, unless otherwise required by applicable law or regulation, (i) higher of (x) the per-share closing price of the Company’s ADS on Nasdaq on the date of grant, which must be a Nasdaq trading day; and (y) the average per-share closing price of the Company’s ADSs on Nasdaq for the five Nasdaq trading days immediately preceding the date of grant, in each case of (x) and (y), multiplied by the applicable conversion ratio from an ADS to ordinary shares, or (ii) in the event that no share or ADS is traded on a national securities exchange, the fair market value of a share determined by the administrator consistent with the rules of Section 422 and Section 409A to the extent applicable. Other than in connection with certain corporate transactions or changes to our capital structure, share options and SARs granted under our 2022 Plan may not be repriced or substituted for with new share options or SARs having a lower exercise price or base value, nor may any consideration be paid upon the cancellation of any share options or SARs that have a per share exercise or base price greater than the fair market value of a share on the date of such cancellation, in each case, without shareholder approval. Each share option and SAR will have a maximum term of not more than ten years from the date of grant (or five years, in the case of certain ISOs).

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Restricted and unrestricted shares and share units. The Compensation Committee may grant awards of shares, share units, restricted shares and restricted share units. A share unit is an unfunded and unsecured promise, denominated in shares, to deliver shares or cash measured by the value of shares in the future, and a restricted share unit is a share unit that is subject to the satisfaction of specified performance or other vesting conditions. Restricted shares are shares that are subject to restrictions requiring that they be redelivered or offered for sale to the Company if specified conditions are not satisfied.

•

Performance awards. The Compensation Committee may grant performance awards, which are awards subject to performance criteria.

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Other stock-based awards. The Compensation Committee may grant other awards that are convertible into or otherwise based on shares, subject to such terms and conditions as it determines.

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Substitute awards. The Compensation Committee may grant substitute awards, which may have terms and conditions that are inconsistent with the terms and conditions of the 2022 Plan.

The 2022 Plan provides that, upon the effectiveness, of a “covered transaction,” as defined in the 2022 Plan, the successor entity may assume, continue or substitute for outstanding awards, as appropriately adjusted. To the extent that awards are not assumed, continued or substituted by the successor entity, all awards requiring exercise granted under the 2022 Plan may become exercisable, and the delivery of any shares remaining deliverable under any outstanding award of share units (including restricted share units and performance awards) may be accelerated.

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The Board of Directors and the Compensation Committee may amend the 2022 Plan or any outstanding award granted under the 2022 Plan and may terminate the 2022 Plan as to any future grants of awards; provided, however, it may not, without the holder’s consent, alter the terms of an award so as to affect materially and adversely the holder’s rights under the award. Notwithstanding the foregoing, under the terms of the 2022 Plan, the Compensation Committee or the Board of Directors may at any time cancel outstanding options that have been granted but not yet exercised. Any amendments to the 2022 Plan will be conditioned upon shareholder approval only to the extent, if any, such approval is required by applicable laws (including the specific provisions of the 2022 Plan which relate to the matters set out in Rule 17.03 of the HK Listing Rules). To the extent required under the rules of any securities exchange or market system on which the shares are listed, amendments to the terms of the 2022 Plan and the terms of the share options granted under the 2022 Plan shall be subject to approval by the Company’s shareholders entitled to vote at a meeting of shareholders. In the event the 2022 Plan is terminated while any share option remains outstanding and unexercised, the provisions of the 2022 Plan shall remain in full force to the extent necessary to give effect to the exercise of any such share option.

As at the latest practicable date (i.e. April 25, 2022), no share options under the 2022 Plan have been granted and thus the Company considers that it would not be appropriate to disclose in this document the value of the share options that may be granted under the 2022 Plan as if they have been granted as at the latest practicable date, as certain variables are not available for calculating the value of the share options under the 2022 Plan. It would not be meaningful and may be misleading to shareholders if the value of the share options is calculated based on a set of speculative assumption.

The granting of awards under the 2022 Plan to an eligible participant who is a connected person (as defined in the HK Listing Rules) (if any) shall comply with the relevant requirements of Chapter 14A of the HK Listing Rules. Nevertheless, the issuance of shares to a connected person pursuant to an exercise of share options granted under the 2022 Plan will be fully exempted from all of the connected transaction requirements under Chapter 14A of the HK Listing Rules. If the awards (other than share options) are to be satisfied by the issuance of new shares, the shares will be issued pursuant to a general mandate granted under Rule 13.36(2) of the HK Listing Rules.

Shares may be awarded to directors of the Company and/or its subsidiaries and/or other connected persons of the Company. If shares are awarded to any director of the Company and/or its subsidiaries and/or other connected persons of the Company, such awards may constitute connected transactions under Chapter 14A of the HK Listing Rules and the Company shall comply with the relevant requirements under Chapter 14A of the HK Listing Rules (including but not limited to obtaining approvals from independent shareholders if so required) as and when appropriate.

If a trustee is appointed for the equity incentive plans, the trustee will become a core connected person of the Company as defined under Rule 1.01 of the HK Listing Rules if the trustee holds any shares on trust for the participants which include connected person(s) of the Company. Accordingly, all the shares held by the trustee will not be counted in the public float of the Company in such circumstances. The Company will closely monitor and take appropriate measures to ensure at least 25% of the Company’s total issued shares are held by the public shareholders from time to time.

The trustee (if and when appointed) will become a connected person of the Company if the number of shares held by such trustee for the benefit of the connected persons of the Company exceeds 30% of the aggregate number of the shares held by the trustee under the equity incentive plans. There is no restriction under the equity incentive plans on the aggregate interests of the Company’s connected persons to be held by such trustee, the Company will comply with the relevant provisions under Chapter 14A of the Listing Rules where appropriate.

Such trustee shall not exercise the voting rights in respect of any shares to be granted, shares underlying the lapsed awards or otherwise which will be held under the trust.

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This summary is subject to the specific provisions contained in the full text of the 2022 Plan set forth in Appendix B to this Proxy Statement.

Information Regarding Our Equity Incentive Program

The following table provides certain additional information regarding our equity incentive program.


	As of December 31, 2021
Total number of outstanding awards under the 2015 Plan and 2017 Plan		90,582,950
Total number of outstanding awards under the 2015 Plan and 2017 Plan, as a percentage of the shares outstanding as of December 31, 2021		9.4	%
Weighted-average exercise price of outstanding share options	$	2.79
Weighted-average remaining term of outstanding share options		5.95 years

Rationale for Share Increase

Our 2017 Plan provides for an automatic annual increase to the number of shares reserved under the 2017 Plan between January 1, 2018 and January 1, 2027 equal to the lesser of 4% of the number of shares outstanding as of the close of business on the immediately prior December 31^st or such number as approved by the Board on or prior to such date each year. The 2022 Plan does not include an “evergreen” feature and there will not be an automatic increase in the number of shares reserved on January 1, 2023 or in future years. The aggregate number of shares reserved and available for issuance under our 2017 Plan as of April 1, 2022 was 75,562,170. The aggregate number of 97,908,743 shares contemplated by the 2022 Plan reflects an increase of 22,346,573 shares reserved and available for issuance, which is equal to approximately 2.2% of the Company’s total shares outstanding as of the date hereof. Given our increased headcount and our continued efforts to motivate and retain our existing employees and to develop and commercialize our product portfolio, which will require further expansion of our organizational structure, we believe the share increase contemplated by the 2022 Plan is critical to our ongoing effort to build shareholder value.

Equity incentive awards are an important component of our executive and non-executive employee compensation. Our equity incentive program is broad-based, and we grant awards to a majority of our employees. By doing so, we link the interests of employees throughout the organization to the interests of our shareholders and motivate our employees to act as owners of the business. Our Compensation Committee and Board of Directors believe that we must continue to offer a competitive equity compensation program in order to attract, retain and motivate the talented and qualified employees necessary for our continued growth and success.

We attempt to manage our long-term shareholder dilution by limiting the number of equity incentive awards we grant annually. The Compensation Committee carefully monitors our annual burn rate, total dilution, and equity expense in order to maximize shareholder value by granting only the appropriate number of equity incentive awards that it believes is necessary to attract, reward, and retain employees.

As of April 25, 2022, the closing price of our ADSs on Nasdaq was US$45.89. Based solely on this and the maximum number of ordinary shares that would have been available for future awards under the 2022 Plan as of such date, the maximum aggregate market value of the ordinary shares that could potentially be issued under the 2022 Plan is US$449,303,221.63. The ordinary shares underlying any awards (other than share options) under the 2022 Plan that are forfeited, cancelled, held back upon exercise or settlement to satisfy the exercise price or tax withholding, reacquired prior to vesting, or are otherwise terminated (other than by exercise) will be added back to the ordinary shares available for issuance under the 2022 Plan. The ordinary shares underlying any share options that are lapsed will be added back to the ordinary shares available for issuance under the 2022 Plan.

We anticipate that, if the 2022 Plan is approved and becomes effective, the number of shares available for grant under the 2022 Plan upon adoption should be sufficient to provide equity incentives to attract, retain, and

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motivate our employees through at least the end of 2024, although it is possible that we will exhaust the share pool sooner if we expand our workforce to support our growing business at a rate higher than we currently expect.

NEW PLAN BENEFITS

Future awards under the 2022 Plan will be granted at the discretion of the Compensation Committee, and, therefore, the types, numbers, recipients, and other terms of such awards cannot be determined at this time. Information regarding our recent practices with respect to equity-based compensation under our 2015 Plan and 2017 Plan is presented elsewhere in this Proxy Statement. The following table sets forth the awards that were granted to our named executive officers, our executive officers as a group, our non-employee directors as a group, and our other employees (who are not executive officers) as a group under the 2017 Plan during the 2021 fiscal year.


Name and Position	Number of Share Options		Number of Restricted Share Unit Awards (excluding Performance-Based Restricted Share Unit Awards)			Number of Performance-Based Restricted Share Unit Awards (assuming target performance)(1)
Named Executive Officers
Samantha (Ying) Du, Chairwoman and Chief Executive Officer		870,000		170,000			631,750
Billy Cho, Chief Financial Officer		240,500		46,000			140,390
F. Ty Edmondson, Chief Legal Officer		220,000		41,500			350,970
Harald Reinhart, President, Head of Global Development, Neuroscience, Autoimmune and Infectious Diseases		266,500		350,500	(2)		350,970
Alan Bart Sandler, President, Head of Global Development, Oncology		280,000		53,000			350,970
All named executive officers as a group ( persons)**		1,877,000		661,000			1,825,050
All non-employee directors, as a group ( persons)**		—		355,170			—
All other employees, as a group		5,461,930		3,229,920			491,350

(1)	Award amounts for PSUs were determined based on the closing price of our ADSs on Nasdaq on the date of grant on December 1, 2021, which was $71.23.

(2)

Includes 50,500 RSUs as annual award and a one-time equity award of 300,000 RSUs made in connection with Dr. Reinhart’s promotion and in consideration of the total compensation of other named executive officers. 50% of the one-time equity award vests immediately and the other 50% vests on Dec 31, 2022.

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Equity Compensation Plan Information

The following table contains information about our equity compensation plans as of December 31, 2021.

Plan Category

Number of
Securities to Be
Issued Upon
Exercise of
Outstanding
Options,
Warrants and
Rights

Weighted-average
Exercise Price of
Outstanding
Options,
Warrants and
Rights

Number of
Securities
Remaining
Available for
Future Issuance
Under Equity
Compensation
Plans (Excluding
Securities
Reflected in
Column(a))

Equity compensation plans approved by security holders(1)

90,582,950

US$

2.79

(2)

59,391,830

(3)

Equity compensation plans not approved by security holders(4)

—

US$

—

Total

90,582,950

US$

2.79

59,391,830

(1)	Equity compensation plans approved by security holders include the 2015 Plan and the 2017 Plan.

(2)	The weighted-average exercise price is calculated based solely on the exercise price of outstanding options and does not take into account outstanding restricted stock units, which have no exercise price.

(3)

Represents the number of shares reversed and available for future issuance under the 2017 Plan. Our 2017 Plan provides for an automatic annual increase to the number of shares reserved under the 2017 Plan between January 1, 2018 and January 1, 2027 equal to 4% of the number of shares outstanding as of the close of business on the immediately prior December 31st or such number as approved by the Board on or prior to such date each year.

(4)	The Company does not have any equity compensation plans not approved by security holders.

Tax Aspects Under the U.S. Internal Revenue Code

The following is a summary of the principal U.S. federal income tax consequences of certain transactions under the 2022 Plan. It describes the consequences based on U.S. federal laws in effect as of the date of mailing of this proxy statement. This summary does not describe all U.S. federal tax consequences under the 2022 Plan, nor does it describe foreign, state or local tax consequences.

Share Options. No income is realized by the optionee at the time the option is granted. Generally (i) at exercise, ordinary income is realized by the optionee in an amount equal to the difference between the option price and the fair market value of the ordinary shares on the date of exercise, and the Company receives a tax deduction for the same amount, and (ii) at disposition, appreciation or depreciation in the exercised shares after the date of exercise is treated as either short-term or long-term capital gain or loss depending on how long the ordinary shares have been held.

Other Awards. The Company generally will be entitled to a tax deduction in connection with an award under the 2022 Plan in an amount equal to the ordinary income realized by the participant at the time the participant recognizes such income. Participants typically are subject to income tax and recognize such tax at the time that an award vests or becomes non-forfeitable, unless the award provides for a further deferral.

Parachute Payments. The vesting of any portion of an option or other award that is accelerated due to the occurrence of a change of control may cause a portion of the payments with respect to such accelerated awards to be treated as “parachute payments” as defined in the Internal Revenue Code. Any such parachute payments may be non-deductible to the Company, in whole or in part, and may subject the recipient to a non-deductible 20% federal excise tax on all or a portion of such payment (in addition to other taxes ordinarily payable).

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Vote Required

The approval of Proposal 11 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy. Broker non-votes and abstentions with respect to Proposal 11 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote. There is no shareholder who has any material interest in Proposal 11, and therefore none of the shareholders is required to abstain from voting on this Proposal 11.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS “VOTE” FOR APPROVAL OF THE ADOPTION OF THE ZAI LAB LIMITED 2022 EQUITY INCENTIVE PLAN, CONDITIONED ON AND SUBJECT TO THE DUAL-PRIMARY LISTING OF THE COMPANY ON THE MAIN BOARD OF THE STOCK EXCHANGE OF HONG KONG LIMITED BECOMING EFFECTIVE.

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PROPOSAL 12

RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND AUDITOR

Description of the Proposal

Our Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the independent registered public accounting firm retained to audit our consolidated financial statements. Following a review process conducted by the Audit Committee, our Audit Committee has selected KPMG, an independent registered public accounting firm in the United States, as our independent registered public accounting firm and auditor for the fiscal year ending December 31, 2022 for the Company’s annual consolidated financial statements filed with the SEC and its internal controls over financial reporting in accordance with the Exchange Act and the consolidated financial statements of the Group for the year ending December 31, 2022 submitted to the HKEx in accordance with the HK Listing Rules, conditioned upon and subject to the Company’s receipt of the requisite approvals from the HKEx and the Financial Reporting Council of Hong Kong. Our Audit Committee believes that the retention of KPMG to serve as our independent registered public accounting firm and auditor for the fiscal year ending December 31, 2022 for the Company’s annual consolidated financial statements filed with the SEC and the consolidated financial statements of the Group for the year ending December 31, 2022 submitted to the HKEx in accordance with the HK Listing Rules and its internal controls over financial reporting in accordance with the Exchange Act is in the best interest of the Company and its shareholders.

Although shareholder approval of our Audit Committee’s selection of KPMG is not required, the Board of Directors believes that it is a matter of good corporate practice to solicit shareholder ratification of this selection. The Board of Directors recommends that shareholders vote for approval and ratification of this appointment. If this proposal is not approved at the Annual Meeting, the Board of Directors will reconsider its appointment of KPMG. Even if the selection is ratified, our Audit Committee has the ability to change the engagement of KPMG if it considers that a change is in the Company’s best interest.

We expect a representative of KPMG to be available at the Annual Meeting in person or virtually and available to respond to appropriate questions. They will have the opportunity to make a statement if they desire to do so, and will be available to respond to appropriate questions.

Prior Year Auditors

Deloitte Touche Tohmatsu Certified Public Accountants LLP, an independent registered public accounting firm in China, and Deloitte Touche Tohmatsu, an independent registered public accounting firm in Hong Kong (together, “Deloitte”), were appointed as our independent registered public accounting firms and auditor, for the fiscal year ending December 31, 2021, respectively. Additionally, Deloitte Touche LLP is U.S. firm that provides tax advisory services for our U.S. tax filings. Deloitte Touche Tohmatsu Certified Public Accountants LLP has audited our financial statements filed with the SEC for the fiscal years ended December 31, 2021, 2020 and 2019 and internal controls over financial reporting for the fiscal years ended December 31, 2021 and 2020. Deloitte Touche Tohmatsu was engaged in 2020 to audit our annual financial statements filed with the HKEx in accordance with the Hong Kong Listing Rules, following our secondary listing on HKEx.

On April 20, 2022, our Audit Committee notified Deloitte that Deloitte will be dismissed from auditing our annual consolidated financial statements, effective after Deloitte’s completion of its services as the Company’s independent registered public accounting firms for the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 and the Company’s receipt of the requisite approvals from the Hong Kong Stock Exchange and the Financial Reporting Council of Hong Kong for the appointment of KPMG LLP. Deloitte’s reports on the Company’s consolidated financial statements for the fiscal years ended December 31, 2020 and December 31, 2021 do not contain any adverse opinion or disclaimer of opinion, nor are qualified or modified as to uncertainty, audit scope or accounting principles.

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During the fiscal years ended December 31, 2020 and December 31, 2021 and the subsequent interim period through the date of the filing of this proxy statement, the Company had (i) no disagreements with Deloitte in any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement(s), if not resolved to the satisfaction of Deloitte, would have caused it to make reference to the subject matter of the disagreement(s) in connection with its reports for such years and interim period and (ii) no reportable events within the meaning of Item 304(a)(1)(v) of Regulation S-K. Additionally, there are no matters in respect of the change of the Company’s auditor that need to be brought to the attention of the shareholders of the Company. We do not expect representatives of Deloitte Touche Tohmatsu Certified Public Accountants LLP or Deloitte Touche Tohmatsu to be available at the Annual Meeting in person or virtually and available to respond to appropriate questions.

In accordance with Item 304(a)(3) of Regulation S-K, the Company has provided Deloitte a copy of the disclosures contained herein prior to its filing with the SEC and requested that Deloitte furnish the Company with a letter addressed to the SEC stating whether Deloitte agrees with the above statements. A copy of that letter, dated May 2, 2022, is filed as Exhibit 16.1 to the Amendment to Company’s Current Report on Form 8-K filed with the SEC on May 2, 2022.

Auditors’ Fees

The following table summarizes the fees of Deloitte Touche Tohmatsu Certified Public Accountants LLP, Deloitte Touche Tohmatsu and Deloitte Touche LLP billed to the Company for each of the last two fiscal years (in thousands of U.S. Dollars).


	2021								2020
Fee Category	Deloitte Touche Tohmatsu Certified Public Accountants LLP		Deloitte Touche Tohmatsu		Deloitte Touche LLP		Total		Deloitte Touche Tohmatsu Certified Public Accountants LLP		Deloitte Touche Tohmatsu		Deloitte Touche LLP		Total
Audit Fees(1)	$	1,070	$	80	$	0	$	1,150	$	1,056	$	420	$	—	$	1,476
Tax Fees(2)	$	11	$	—	$	77	$	88	$	1	$		$	—	$	1
All Other Fees(3)	$	—	$	—	$	—	$	—	$	100	$		$	—	$	100
Total Fees	$	1,081	$	80	$	77	$	1,238	$	1,157	$	420	$	—	$	1,577

(1)

Audit fees consist of fees for the audit of our consolidated financial statements, reviews of our interim financial statements and the audit of the effectiveness of our internal control over financial reporting. Audit fees also include related services that are normally provided in connection with registration statements and securities offerings on Nasdaq in 2021 and 2020 and our Hong Kong listing in 2021 and 2020, and other statutory and regulatory filings.

(2)	Tax fees consist of fees incurred for tax advisory services.

(3)	All other fees consist of fees incurred for Hong Kong listing-related internal control compliance check service fees and other products and services other than the services described above.

Pre-approval Policies

The Board of Directors has adopted policies and procedures for the pre-approval of audit and non-audit services by the Audit Committee for the purpose of maintaining the independence of our independent auditors. The Audit Committee pre-approves all auditing services, internal control-related services and permitted non-audit services to be performed for the Company by its independent auditor. Consistent with any applicable SEC rules on auditor independence, the Audit Committee annually may establish ceilings on the level of fees and costs of generally pre-approved and sufficiently defined services that may be performed without seeking additional approval from the Committee. The Committee may delegate pre-approval authority to one or more of its members. The member (or members) to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Committee at its next regularly scheduled meeting. In accordance with Regulation S-X, Rule 2-01, paragraph (c)(7)(i), no fees for services in 2020, 2019 and 2018 were approved pursuant to any waivers of the pre-approval requirement.

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The Audit Committee has reviewed an independence letter from KPMG to the Committee dated April 12, 2022, taken into consideration each of the factors addressed therein pertaining to the independence of KPMG and its affiliates and determined that KPMG has not provided any non-audit services and has determined that KPMG is independent with respect to the Company and its affiliates and in compliance with PCAOB Rule 3520.

Vote Required and Board of Directors’ Recommendation

Approval of Proposal 12 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person, virtually or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 12 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote. We expect that there will be no broker non-votes on this proposal due to the discretionary authority granted to brokerage firms, banks and other financial institutions.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND AUDITOR FOR THE FISCAL YEAR ENDING DECEMBER 31, 2022 FOR THE COMPANY’S ANNUAL CONSOLIDATED FINANCIAL STATEMENTS FILED WITH THE SEC AND ITS INTERNAL CONTROLS OVER FINANCIAL REPORTING IN ACCORDANCE WITH THE EXCHANGE ACT AND THE CONSOLIDATED FINANCIAL STATEMENTS OF THE GROUP FOR THE YEAR ENDING DECEMBER 31, 2022 SUBMITTED TO THE HKEX IN ACCORDANCE WITH THE HK LISTING RULES, CONDITIONED UPON AND SUBJECT TO THE COMPANY’S RECEIPT OF THE REQUISITE APPROVALS FROM THE HKEX AND THE FINANCIAL REPORTING COUNCIL OF HONG KONG.

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PROPOSAL 13

GENERAL MANDATE TO ISSUE SHARES

Description of the Proposal

In order to give the Company the flexibility to issue ordinary shares and/or ADSs if and when appropriate and in accordance with Rule 13.36 of the HK Listing Rules, the Company proposes an ordinary resolution at the Annual Meeting to approve the granting of a share issue mandate to the Board of Directors to issue, allot or deal with unissued ordinary shares and/or ADSs not exceeding 20% of the total number of issued ordinary shares of the Company as at the date of passing of such ordinary resolution (equal to a total of 195,817,486 ordinary shares as of April 22, 2022 on the basis that no further ordinary shares are issued or repurchased before the Annual Meeting) up to the next annual general meeting of the Company, conditioned on and subject to the dual-primary listing of the Company on the Main Board of The Stock Exchange of Hong Kong Limited becoming effective (the “General Mandate to Issue Shares”). The General Mandate to Issue Shares shall remain in force until:

•

the conclusion of the next annual general meeting of shareholders of the Company unless, by an ordinary resolution passed at that meeting, the General Mandate to Issue Shares is renewed, either unconditionally or subject to conditions; or

•

revoked or varied by an ordinary resolution of the shareholders in a general meeting, whichever occurs first.

Proposal 13 is being submitted for shareholder approval as required by the HKEx and/or in compliance with the HK Listing Rules.

Vote Required

Approval of Proposal 13 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 13 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE APPROVAL OF THE GENERAL MANDATE TO ISSUE SHARES.

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PROPOSAL 14

NON-BINDING, ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

Description of the Proposal

Consistent with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), we are providing our shareholders with an opportunity to indicate whether they support our named executive officer compensation as described in detail in the “Compensation Discussion and Analysis” and the accompanying “Executive Compensation” section beginning on page 53 of this Proxy Statement. This non-binding advisory vote, commonly referred to as “say-on-pay,” is not intended to address any specific item of compensation, but instead relates to the “Compensation Discussion and Analysis,” the tabular disclosures regarding named executive officer compensation, and the narrative disclosure accompanying the tabular presentation. These disclosures allow you to view the trends in our executive compensation program and the application of our compensation philosophies for the years presented.

As discussed in detail in the “Compensation Discussion and Analysis” section of this proxy statement, our executive compensation guiding principles and structure are designed to attract and retain extraordinary leaders who can perform at high levels and succeed in a demanding business environment.

Specifically, our executive compensation program in 2021 was:

•

Mission Focused and Business Driven. Our executive compensation program focused on whether each named executive officer achieved his or her performance goals which support the annual and long-term objectives of our business which include the delivery of meaningful and innovative products to address unmet medical needs. Our objective is to provide an executive compensation program that contributes to building and sustaining a foundation for long-term success.

•

Market Advantages. While we consider the executive compensation programs of a peer group of biotechnology and pharmaceutical companies that we believe are representative of the companies we primarily compete with for talent in all the geographies where we do business, we do not benchmark our compensation, or its components, to a specific market percentile of compensation within such peer group. Broader market data, as further described below, is also considered in order to provide additional context for our executive compensation decisions. Peer group and market practices are among the many factors we take into account in developing an executive compensation program that we believe is effective in enabling us to recruit, retain and motivate our leadership team to achieve our business objectives and enhance shareholder value.

•

Performance Focused. We believe strongly in pay-for-performance and endeavor to provide our named executive officers with higher levels of compensation when our business goals and their personal performance objectives are met or exceeded and would correspondingly reduce compensation when performance does not meet our expectations and goals.

•

Aligned with Shareholders. We believe every employee contributes to our success and, as such, every employee has a vested interest in our success. For members of our executive team, including our named executive officers, who set and lead our future strategic direction, we ensure that a significant portion of their total pay opportunities are equity-based to maintain alignment between the interests of our executive officers and our shareholders.

•

Flexible. We are committed to providing flexible benefits designed to allow our diverse global workforce to have rewarding opportunities that meet their varied needs so that they are inspired to perform their very best on behalf of patients and shareholders each day.

The Compensation Committee actively reviews and assesses our executive compensation program in light of the highly competitive employment environment, the challenge of recruiting, motivating and retaining executives in

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an industry with longer business cycles than other commercial industries, significant risks associated with success in our industry and evolving compensation governance and best practices. In reconciling these considerations, the Compensation Committee strives to act in the long-term best interests of the Company and our shareholders and believes that our executive compensation program is strongly aligned with the long-term interests of our shareholders. In determining whether to approve this proposal, the Compensation Committee believes that shareholders should consider the following with respect to 2021 compensation:

•

Independent Compensation Committee. Executive compensation is reviewed and established by the Compensation Committee of the Board consisting solely of independent directors.

•

No personal benefits. Our executive officers are eligible for the same benefits as non-executive, salaried employees, and do not receive any personal benefits.

•

No tax gross-ups on compensation. None of our executive officers receive tax related gross-ups on any element of compensation.

•

Cash severance benefits only payable upon a qualifying termination of employment. Executive officer employment agreements require an actual or constructive termination of employment before any cash benefits are paid.

•

No retirement benefits. We do not offer any pension plans or health benefits during retirement.

We actively monitor our executive compensation practices in light of the industry in which we operate and the marketplace for talent in which we compete. We are focused on compensating our executive officers fairly and in a manner that incentivizes high levels of performance while providing the Company with tools to attract and retain the best talent.

Vote Required

Advisory approval of Proposal 14 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy at the Annual Meeting. Broker non-votes and abstentions with respect to Proposal 14 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote. The say-on-pay vote is advisory and therefore not binding on the Board of Directors, the Compensation Committee or our Company. However, the Board of Directors and the Compensation Committee value the opinion of our shareholders, and to the extent there is a significant vote against the compensation of our named executive officers as disclosed in this Proxy Statement, we will consider our shareholders’ concerns, and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.

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PROPOSAL 15

ADVISORY VOTE TO APPROVE FREQUENCY OF FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATION

Description of the Proposal

We are also seeking a non-binding advisory vote on the frequency with which say-on-pay votes, like Proposal 14 in this Proxy Statement, should be held in the future. This advisory vote is commonly referred to as “say on frequency.” Under the Dodd-Frank Act, promulgated under the Exchange Act, shareholders may vote to indicate their preference for conducting a say-on-pay vote:

•

Every three years;

•

Every two years; or

•

Every year.

Shareholders may also abstain from voting on this proposal. In considering your vote, you may wish to review the information presented in connection with Proposal 14 in this Proxy Statement, as well as the “Compensation Discussion and Analysis” and “Executive Compensation” sections of this Proxy Statement, which provide a more detailed discussion of our executive compensation program and policies.

The Board of Directors has determined that holding a “say-on-pay” vote every three years is most appropriate for the Company and recommends that you vote to hold such advisory vote in the future every third year, for the following reasons:

•

Aligns the Company’s approach to executive compensation with underlying Compensation Committee philosophy. Our executive compensation program is designed to enhance the long-term growth of the Company and reward performance over a multi-year period. For example, our executive team has been granted stock option awards that vest over multi-year periods, typically over five years.

•

Encourages longer-term evaluation of compensation history and business results. The Board of Directors believes that there is some risk that an annual advisory vote on executive compensation could lead to a short-term shareholder perspective regarding executive compensation that does not align well with our Compensation Committee’s approach to incentivize long-term company performance through a higher emphasis on long-term compensation incentives. We believe a three-year cycle for the shareholder advisory vote will provide investors the most meaningful timing alternative through which to evaluate the effectiveness of our executive compensation strategies and their alignment with our company’s performance.

•

Provides adequate time to consider say-on-pay vote results and other shareholder input. A triennial “say-on-pay” vote allows the Board of Directors to respond to shareholder sentiment and effectively implement any desired changes to executive compensation policies, practices and programs. The Board of Directors believes that a triennial “say-on-pay” vote would not foreclose shareholder engagement on executive compensation during interim periods. Shareholders can currently provide input to the Board of Directors by communicating directly with the Board of Directors, its committees or individual directors as indicated in “Corporate of the Company—Shareholder Communications” below. Thus, we view the advisory vote on executive compensation as an additional, but not exclusive, opportunity for our shareholders to communicate their views on our executive compensation program.

The Board of Directors weighed the reasons set forth above against the arguments in support of conducting the advisory vote annually or biannually. In particular, the Board of Directors considered the value of the opportunity for shareholder input at each annual meeting, as well as the belief that annual votes would promote greater accountability on executive compensation. Although the Board of Directors believes that these and other

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positions put forth in favor of an annual “say-on-pay” vote are not without merit, on balance, the Board of Directors believes that a triennial approach is most appropriate for the Company and recommends that voting alternative to shareholders.

The Board of Directors intends to periodically reassess that view and, if it determines appropriate, may provide for an advisory vote on executive compensation on a more frequent basis.

Vote Required

For the reasons discussed above, the Board of Directors recommends that shareholders vote to hold the advisory vote on executive compensation every three years. Shareholders are not voting, however, to approve or disapprove of this particular recommendation. The proxy card provides for four choices and shareholders are entitled to vote on whether the advisory vote on executive compensation should be held every one, two or three years or to abstain from voting on this proposal.

Advisory approval of Proposal 15 requires the favorable vote of a simple majority of the votes cast by the shareholders entitled to vote who are present in person or by proxy. Broker non-votes and abstentions with respect to Proposal 15 will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the vote. With respect to this proposal, if none of the frequency options (one year, two years or three years) receive a majority vote, we will consider the frequency that receives the highest number of votes cast by shareholders to be the frequency that has been recommended by shareholders. Proposal 15 is non-binding. Because this vote is advisory and not binding on us or the Board of Directors, the Board of Directors may decide that it is in our and our shareholders’ best interests to hold an advisory vote on executive compensation more or less frequently than the alternative approved by our shareholders. However, the Board of Directors does intend to take the results of the vote on this proposal into account in its decision regarding the frequency with which our Company submits say-on-pay proposals in the future.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” APPROVAL, ON AN ADVISORY BASIS, OF THE HOLDING OF AN ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS EVERY THREE YEARS.

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TRANSACTION OF OTHER BUSINESS

The Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting as of the date of this Proxy Statement. If any other matters are properly brought before the Annual Meeting, the person(s) named in the accompanying proxy intend to vote on such matters in accordance with their best judgment.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The table below sets forth certain information known to us regarding beneficial ownership of our share capital as of April 1, 2022 by:

•

each person, or group of affiliated persons, known by us to be the beneficial owner of more than 5% of any class of our voting securities;

•

each of our named executive officers;

•

each of our directors; and

•

all of our executive officers and directors as a group.

Beneficial ownership as set forth below is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities, except as otherwise provided. The beneficial ownership rules of the SEC differ from those of the SFO and the HK Listing Rules. Except as noted by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole voting and investment power with respect to all securities shown as beneficially owned by them.

The beneficial ownership percentages in the table below are based on 964,087,430 ordinary shares outstanding as of April 1, 2022. Any options to purchase ordinary shares that are exercisable and RSUs that will vest within 60 days of April 1, 2022 are deemed to be beneficially owned by the persons holding these options for the purpose of computing the percentage ownership of such persons, but are not treated as outstanding for the purpose of computing any other person’s ownership percentage.


Name of Beneficial Owner(1)	No. of Ordinary Shares(2)		Percent(3)
Directors and Named Executive Officers:
Samantha (Ying) Du(4)		45,347,660		4.56	%
Kai-Xian Chen		310,160		*
John Diekman		487,820		*
Richard Gaynor, M.D.		89,120		*
Nisa Leung		—		*
William Lis		287,640		*
Scott Morrison		73,450		*
Leon O. Moulder, Jr.		216,150		*
Peter Wirth		3,506,150		*
Billy Cho(5)		3,577,300		*
F. Ty Edmondson(6)		162,460		*
Harald Reinhart(7)		985,250		*
Alan Bart Sandler(8)		196,180		*
All Directors and Executive Officers as a Group		55,239,340		5.53	%
Beneficial Owners of 5% or More of our Ordinary Shares(14):
QM11 Limited(9)		79,229,320		8.2	%
Invesco Advisers(10)		72,864,930		7.6	%
Fidelity Management & Research Company LLC(11)		70,473,510		7.3	%
Baillie Gifford & Co.(12)		56,589,010		5.9	%

(1)	The business address of all directors and officers is 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210.

(2)	One American Depositary Share of the Company represents ten Ordinary Shares.

(3)	Beneficial ownership representing less than 1% is denoted with an asterisk (*).

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(4)

Includes 29,931,250 ordinary shares issuable upon exercise of vested options, options exercisable and RSUs eligible to vest within 60 days of April 1, 2022. Also includes 5,626,660 ordinary shares held by certain holders of ordinary shares, including the Company’s management and their affiliates, for which Dr. Du does not have any pecuniary interest but for which she may be deemed beneficial owner as these holders have granted Dr. Du the right to vote their shares .

(5)	Includes 3,068,100 ordinary shares issuable upon exercise of vested options, options exercisable and RSUs eligible to vest within 60 days of April 1, 2022.

(6)	Includes 119,500 ordinary shares issuable upon exercise of vested options, options exercisable and RSUs eligible to vest within 60 days of April 1, 2022.

(7)	Includes 886,640 ordinary shares issuable upon exercise of vested options, options exercisable and RSUs eligible to vest within 60 days of April 1, 2022.

(8)	Includes 150,000 ordinary shares issuable upon exercise of vested options, options exercisable and RSUs eligible to vest within 60 days of April 1, 2022.

(9)	Based on information provided in a Schedule 13G/A filed by Qiming Corporate GP IV, Ltd. on February 14, 2022. The address for QM 11 Limited is Units 4206-06 Gloucester Tower, The Landmark, Central, Hong Kong.

(10)

Based on information provided in a Schedule 13G/A filed by Invesco Ltd. on February 14, 2022. Invesco Ltd., in its capacity as a parent holding company to its investment advisers, may be deemed to beneficially own 7,286,493 ordinary shares which are held of record by clients of Invesco Ltd. The address for Invesco Ltd. is 1555 Peachtree Street NE, Suite 1800, Atlanta, GA 30309.

(11)

Based on information provided in a Schedule 13G/A filed by FMR LLC on February 9, 2022. Abigail P. Johnson is a Director, the Chairman and the Chief Executive Officer of FMR LLC. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act (“Fidelity Funds”) advised by Fidelity Management & Research Company (“FMR Co”), a wholly-owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees. FMR Co. LLC carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. The address for FMR LLC is 245 Summer Street, Boston, Massachusetts 02110.

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Based on information provided in a Schedule 13G filed by Baillie Gifford & Co. on January 27, 2022. Securities reported as being beneficially owned by Baillie Gifford & Co. are held by Baillie Gifford & Co. and/or one or more of its investment adviser subsidiaries, which may include Baillie Gifford Overseas Limited, on behalf of investment advisory clients, which may include investment companies registered under the Investment Company Act of 1940, employee benefit plans, pension funds or other institutional clients. The address for Baillie Gifford & Co. is Calton Square, 1 Greenside Row, Edinburgh EH1 3AN, Scotland, UK.

(13)	The beneficial ownership percentages are calculated based upon an aggregate of 964,087,430 Ordinary Shares outstanding as of April 1, 2022.

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GOVERNANCE OF THE COMPANY

Composition of the Board of Directors

The following table sets forth the name, age and position of each of our directors as of April 1, 2022:


Name	Age	Position(s)	Director Since
Samantha (Ying) Du	57	Founder, Chief Executive Officer, Chairperson of the Board of Directors		2014
Richard Gaynor, M.D.	72	Director		2021
Kaixian Chen	76	Director		2018
John D. Diekman	79	Director		2017
Nisa Leung	51	Director		2014
William Lis	57	Director		2018
Leon O. Moulder Jr.	64	Director		2020
Peter Wirth	71	Director		2017
Scott Morrison	64	Director		2021

Election of Directors

The Board of Directors currently consists of nine members. The Current Articles provide that unless otherwise determined by the Company in a general meeting, the authorized number of directors shall be not less than one or more than ten. We are not subject to any contractual obligations regarding the election of our directors. Our Nominating and Corporate Governance Committee and Board of Directors may consider a broad range of factors relating to the qualifications and background of nominees, as further set forth below under “Director Nominations.”

Cayman law does not require an annual election of directors and the Current Articles provide that directors hold office until their successors have been elected and qualified or until the earlier of their resignation or removal.

The Current Articles provide that (1) the shareholders requisitioning a general meeting of shareholders may put forward resolutions to appoint or remove directors (with or without cause), and (2) at that meeting so convened, the affirmative vote of a simple majority of the issued shares as of the applicable record date may by ordinary resolution approve the removal of directors. Shareholders holding in aggregate not less than one-tenth of the voting rights of issued shares and entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders in accordance with the Current Articles. Additionally, the Current Articles provide that any vacancy on the Board of Directors, including a vacancy resulting from an enlargement of the Board of Directors, may be filled by ordinary resolution or by vote of a simple majority of our directors then in office.

Independence of Directors

The Board of Directors has determined that all members of the Board of Directors, except Samantha (Ying) Du, are independent, as determined in accordance with the Nasdaq listing rules; and that all members of the Board of Directors, except Samantha (Ying) Du, are independent, as determined in accordance with the HK Listing Rules. In making this independence determination, the Board of Directors considered the relationships that each such director has with us and all other facts and circumstances that the Board of Directors deemed relevant in determining their independence, including the beneficial ownership of our share capital by each director. In considering the independence of the directors listed above, the Board of Directors considered the association of

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our directors with the holders of more than 5% of our share capital. We expect that the composition and functioning of the Board of Directors and each of our committees will continue to comply with all applicable requirements of the Nasdaq Stock Market, the rules and regulations of the SEC and the HK Listing Rules. There are no family relationships among any of our directors or executive officers.

Director Nominations

The Board of Directors will consider and approve from time to time the criteria that it deems necessary or advisable for director candidates. The Board of Directors has full authority to modify such criteria as it deems necessary or advisable. The Board of Directors has delegated to the Nominating and Corporate Governance Committee the responsibility for developing and recommending to the Board of Directors for its consideration and approval criteria for director candidates. The Company has adopted guidelines and procedures for director candidates. The Board of Directors may, however, rescind its delegation and assume the responsibilities it previously delegated to the Nominating and Corporate Governance Committee.

The Board of Directors has delegated to the Nominating and Corporate Governance Committee the responsibility to identify candidates for nomination to the Board of Directors (including candidates to fill vacancies) and assessing their qualifications in light of the principles in our Corporate Governance Guidelines and the Committee’s charter. The Nominating and Corporate Governance Committee will recommend director candidates for the Board of Directors’ consideration and review the candidates’ qualifications with the Board of Directors. The Board of Directors retains the authority to nominate a candidate for election by the shareholders as a director and to fill vacancies. From time to time, the Nominating and Corporate Governance Committee utilizes third-party search firms to identify director candidates. In identifying director candidates, the Nominating and Corporate Governance Committee may consider all facts and circumstances it deems appropriate, including, among other things, the skills of the candidate, his or her depth and breadth of business experience and other background characteristics, his or her independence and the needs of the Board of Directors.

Our Nominating and Corporate Governance Committee has not adopted a formal policy with respect to a fixed set of specific minimum qualifications for its candidates for membership on the Board of Directors. Our Nominating and Corporate Governance Committee and Board of Directors may therefore consider a broad range of factors relating to the qualifications and background of nominees. Our Nominating and Corporate Governance Committee’s and Board of Directors’ priority in selecting board members is the identification of persons who will further the interests of our shareholders through his or her established record of professional accomplishment, the ability to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive landscape, and professional and personal experiences and relevant expertise.

Director Nominations by Shareholders

Any shareholder wishing to recommend a director candidate for consideration by the Nominating and Corporate Governance Committee should provide the following information within the time frame set forth for shareholder proposals and in accordance with our Articles of Association to Zai Lab Limited, 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, attention to Chief Legal Officer & Corporate Secretary: (a) the name and address of record of the shareholder; (b) a representation that the shareholder is a record holder of our securities or, if the shareholder is not a record holder, evidence of ownership in accordance with Rule 14a-8(b)(2) of the Exchange Act; (c) the candidate’s name, age, business and residential address, educational background, current principal occupation or employment, and principal occupation or employment for the past five years; (d) a description of the qualifications and background of the candidate that addresses the criteria for board membership approved by the Board of Directors; (e) a description of all arrangements or understandings between the shareholder and the candidate; (f) the consent of the candidate (i) to be named in the proxy statement for our next general meeting and (ii) to serve as a director, if elected at that meeting; and (g) and any other information

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regarding the candidate that is required to be included in a proxy statement filed pursuant to SEC rules and HK Listing Rules. The Nominating and Corporate Governance Committee may seek further information from or about the shareholder making the recommendation, the candidate, or any such other beneficial owner, including information about all business and other relationships between the candidate and the shareholder and between the candidate and any such other beneficial owner.

Shareholder Communications

The Board of Directors provides to every shareholder the ability to communicate with the Board of Directors, as a whole, and with individual directors on the Board of Directors through an established process for shareholder communication. For a shareholder communication directed to the Board of Directors as a whole, shareholders may send such communication to the attention of our Corporate Secretary via regular mail or expedited delivery service to: Zai Lab Limited, 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, attention Board of Directors c/o Corporate Secretary.

For a shareholder communication directed to an individual director in his or her capacity as a member of the Board of Directors, shareholders may send such communication to the attention of the individual director via Regular Mail or Expedited Delivery Service to: Zai Lab Limited, 4560 Jinke Road, Bldg. 1, Fourth Floor, Pudong, Shanghai, China 201210, Attention: [Name of Individual Director].

Communications will be distributed to the Board of Directors, or to any individual director or directors as appropriate, depending on the facts and circumstances outlined in the communications. Items that are unrelated to the duties and responsibilities of the Board of Directors may be excluded, such as junk mail and mass mailings, resumes and other forms of job inquiries, surveys and solicitations or advertisements.

Board Leadership Structure and Role in Risk Oversight

Our Founder and Chief Executive Officer, Samantha (Ying) Du, is the Chairperson of the Board of Directors. The Board of Directors believes that Dr. Du is the director best suited to identify strategic opportunities for the Company and the focus of the Board of Directors due to her extensive understanding of our business as a founder and our Chief Executive Officer. The Board of Directors also believes that the combined role of Chairperson and Chief Executive Officer can promote the effective execution of strategic initiatives and facilitate the flow of information between management and the Board of Directors.

The Board of Directors oversees the management of risks inherent in the operation of our business and the implementation of our business strategies. The Board of Directors performs this oversight role by using several different levels of review. In connection with its reviews of our operations and corporate functions, the Board of Directors addresses the primary risks associated with those operations and corporate functions. In addition, the Board of Directors reviews the risks associated with our business strategies periodically throughout the year.

Each of the board committees also oversees the management of our risk that falls within the committee’s areas of responsibility. In performing this function, each committee has full access to management, as well as the ability to engage advisors. Our Chief Financial Officer reports to the Audit Committee and is responsible for identifying, evaluating and implementing risk management controls and methodologies to address any identified risks. In connection with its risk management role, our Audit Committee meets privately with representatives from our independent registered public accounting firms and our Chief Financial Officer. The Audit Committee oversees the operation of our risk management program, including the identification of the primary risks associated with our business and periodic updates to such risks, and reports to the Board of Directors regarding these activities.

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Board Diversity

In accordance with Nasdaq Rule 5606, the below chart provides information on each of our director’s voluntary, self-identified characteristics.


Board Diversity Matrix (as of April 1, 2022)
Board Size:
Total Number of Directors	9
	Female	Male
Gender Identity
Directors	2	7
Demographic Background
Asian	2	1
White	0	5
Did not disclose demographic background	0	1

Board Meetings

The Board of Directors held six meetings and acted by unanimous written consent eight times during 2021. The independent directors ordinarily hold executive sessions at regularly scheduled meetings of the Board of Directors. Each of our other directors then in office attended at least 75% of the aggregate of all meetings of the Board of Directors and all meetings of the committees of the Board of Directors on which such director then served. Directors and director nominees are encouraged to attend the annual general meeting of shareholders, barring significant commitments or special circumstances.

Committees of the Board

During 2021, the Board of Directors had four standing committees: the Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee and the Research and Development Committee.

Audit Committee

John Diekman, Peter Wirth and Scott Morrison currently serve on the Audit Committee, which is chaired by John Diekman. The Board of Directors has determined that each member of the Audit Committee is “independent” for Audit Committee purposes as that term is defined in the rules of the SEC and the Nasdaq Stock Market. The Board of Directors has evaluated the background of Scott Morrison and, upon so doing, designated him as an “audit committee financial expert,” as defined in SEC rules. The Audit Committee’s responsibilities include:

•

appointing, approving the compensation of, assessing the qualification, independence and performance of and terminating or changing our independent auditor;

•

approving auditing and permitted non-audit services, and the terms of such services, to be provided by our independent auditor;

•

reviewing the internal audit department’s responsibilities, budget, staffing and any recommended changes in the planned scope of the internal audit with the independent auditor and management;

•

reviewing and discussing with management and the independent auditor our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;

•

reviewing the adequacy of our internal control over financial reporting;

•

establishing policies and procedures for the receipt and retention of financial and accounting-related complaints and concerns;

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•

recommending, based upon the Audit Committee’s review and discussions with management and the independent auditor, whether our audited financial statements shall be included in our Annual Report on Form 10-K and our annual results announcement filed with the SEC and HKEx;

•

monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;

•

preparing the Audit Committee report and other disclosures required by the SEC rules to be included in our annual proxy statement;

•

reviewing all related party transactions for potential conflict of interest situations and approving all such transactions; and

•

reviewing our earnings releases and unaudited financial statements to be included in our quarterly and interim filings with the SEC and HKEx.

The Audit Committee held seven meetings and acted by unanimous written consent three times during 2021. The Audit Committee operates under a written charter that satisfies the applicable standards of the SEC, the Nasdaq Stock Market and the HKEx. A copy of the Audit Committee charter is available on our website at https://www.zailaboratory.com/ under “Investors.”

Compensation Committee

Peter Wirth, Nisa Leung and Leon O. Moulder, Jr. currently serve on the Compensation Committee, which is chaired by Peter Wirth. The Board of Directors has determined that each member of the Compensation Committee is “independent” as that term is defined in the Nasdaq listing rules and the HKEx. The Compensation Committee’s responsibilities include:

•

reviewing the corporate goals and objectives relevant to the compensation of our Chief Executive Officer, evaluating the performance of our Chief Executive Officer in light of such corporate goals and objectives and recommending to the Board of Directors for approval our Chief Executive Officer’s compensation based on that evaluation;

•

reviewing and approving the compensation of our other executive officers;

•

approving our long-term compensation strategy for employees and directors and determining the types of shares and other compensation plans to be used by us and our affiliates;

•

overseeing the administration of our equity incentive plans;

•

evaluating and assessing legal counsel, compensation consultants and other advisors in accordance with the applicable requirements in the Nasdaq listing rules;

•

retaining and approving the compensation of any outside advisors to the Compensation Committee;

•

reviewing and approving the grant of equity-based awards;

•

reviewing and making recommendations to the Board of Directors with respect to director compensation;

•

preparing the compensation committee report required by SEC rules to be included in our annual proxy statement or Annual Report on Form 10-K; and

•

reviewing and discussing with management the compensation discussion and analysis to be included in our annual proxy statement or Annual Report on Form 10-K.

The Compensation Committee held seven meetings and acted by unanimous written consent five times during 2021. The Compensation Committee operates under a written charter adopted by the Board of Directors, which is available on our website at https://www.zailaboratory.com/ under “Investors.”

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Nominating and Corporate Governance Committee

Leon O. Moulder, Jr., John Diekman and William Lis currently serve on the Nominating and Corporate Governance Committee, which is chaired by Leon O. Moulder, Jr. The Board of Directors has determined that each member of the Nominating and Corporate Governance Committee is “independent” as that term is defined in the Nasdaq listing rules and the HKEx. The Nominating and Corporate Governance Committee’s responsibilities include:

•

identifying and recommending candidates for membership of the Board of Directors and committees to the Board of Directors in accordance with criteria approved by the Board of Directors;

•

recommending to the Board of Directors or to the appropriate committee thereto processes for annual evaluation of the performance of the Board of Directors, the Chairperson of the Board of Directors, the Chief Executive Officer and appropriate committees of the Board of Directors;

•

reviewing our practices and policies with respect to the Board of Directors and the functions, duties and composition of the committees thereto;

•

developing and recommending to the Board of Directors a set of corporate governance principles and reviewing the principles on an annual basis, or more frequently if appropriate; and

•

overseeing the maintenance and presentation of the Board of Directors or management’s plans for succession to our senior management positions.

The Nominating and Corporate Governance Committee held four meetings and acted by unanimous written consent once during 2021. The Nominating and Corporate Governance Committee operates pursuant to a written charter adopted by the Board of Directors, which is available on our website at https://www.zailaboratory.com/ under “Investors.”

Research and Development Committee

Richard Gaynor, M.D., Kai-Xian Chen, Samantha Du and William Lis currently serve on the Research and Development Committee, which is chaired by Richard Gaynor, M.D. The Research and Development Committee’s responsibilities include:

•

reviewing and discussing with management strategic research and development objectives and priorities for the Company, identifying opportunities for further research and development projects and assessing, informing and recommending to the Board of Directors such strategies and opportunities that it deems suitable for the Company;

•

overseeing, assessing and where applicable, approving any ongoing Company research and development programs;

•

providing feedback and advice to the Board of Directors regarding Company’s ongoing research and development programs and activities; and

•

identifying, retaining or terminating any specific advisor or consultant to be used to assist in the Company’s research and development programs and objectives.

The Research and Development Committee did not hold meetings and or act by unanimous written consent during 2021, as the inaugural meeting of this Committee was held in January 2022. The Research and Development Committee operates pursuant to a written charter adopted by the Board of Directors, which is available on our website at https://www.zailaboratory.com/ under “Investors.”

Environmental, Social and Governance Practices

We understand that to achieve our ambitious mission, we must continue to integrate environmental protection, social responsibility and governance practices (ESG) into the Company’s daily operations. In September 2021,

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the Company issued its first ESG report, aligned to industry appropriate standards set by the Sustainable Accountability Standards Board (SASB), with influence from other sources, including the United Nations Sustainable Development Goals (SDGs) and guidelines of Institutional Shareholders Services (ISS). The Company’s ESG program details are included in the 2021 ESG report. Key disclosures and highlights include:

Social

Access to/affordability of medicines. The Company has the goal of widespread access to treatments that deliver value for the societies that provide them and for patients in need, which will in turn allow our Company to continue discovering innovative solutions for serious unmet medical conditions. We aim to achieve universal or near-universal access to our products following these commitments:

•

Prior to the approval of products in the Greater China region (GCR), we support early access to the products after they are approved by the FDA.

•

Secure timely reimbursement through governmental programs as well as through commercial insurance plans.

•

Support Patient Assistant and Education Programs when and where appropriate, according to local laws and regulations.

Drug safety. One of the Company’s values is patient first. We monitor drug safety and quality at all stages of the drug development process because we care about patient safety. We have established formal standards and protocols to ensure the integrity and safety of all investigational compounds used in clinical studies, as well as commercial therapies provided to patients. This includes formal and rigorous standards and protocols for ensuring the quality and safety of all products throughout the manufacturing and distribution chain. We have not received any warning letters from regulators and have had no product recalls.

Clinical Trial Research and Transparency. We commit to conduct ethical, transparent and safe clinical trial research. In all clinical research conducted by or on behalf of the Company, we and our partners follow local laws and regulations. We follow the International Council for Harmonization Good Clinical Practice (ICH-GCP). Our clinical Quality Management System (QMS) covers clinical quality assurance, pharmacovigilance and clinical study life cycle management. The QMS consists of four Policies, 87 SOPs/Work Instructions and more than 240 associated templates or working forms. No clinical trials conducted by the Company resulted in a Voluntary Action Indicated or an Official Action Indicated, and no clinical trials conducted by the Company resulted in losses from legal proceedings.

Employee Recruitment, Development & Retention. We understand that the people who work with us are our most valuable asset. Our six corporate values: Entrepreneurship, Innovation, Patient First, Collaboration, Dedication and Integrity drive our commitment to our employees. Key aspects of our commitments include:

•

Equal opportunities in recruitment, internal transfer and promotion to candidates and employees regardless of their gender, nationality, marital status, disability and religious belief, a policy that is documented in our Code of Conduct.

•

Fair compensation to all employees based on a rigorous focus on salaries, benefits and retirement programs aligned with the norms of all societies where employees live and work.

•

Leadership Competency Model with specific behaviors that anchor all employees to perform successfully in their jobs and enhance career development

•

Talent Review Process to identify key individuals with consistent standards and build robust succession pipelines for critical positions.

Gender diversity, equity and inclusion. We understand that in order to be competitive in today’s environment, we must maintain a company culture where everyone can contribute and thrive. We are committed to providing

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equal opportunities to our workforce. The Company has established and maintains female representation in senior management, including the Founder/Chairperson/CEO and two out of nine members of the Board of Directors. Within the company overall, 58% of the workforce are women. Women hold 53.8% of management positions. We are proud that we have gender equity in management positions and that we have base salary pay equity at all levels of the organization.

Environmental

Energy, water and waste efficiency. We know our daily operations, where and how we work, matter in the fight against climate change. We are also aware of the threat of climate change on our business operations. We commit to reduce the environmental footprint of all business practices and work with our partners to encourage and support their efforts to do the same. Our internal environmental management system is set up according to the ISO14001 framework. We have procedures in place for Environmental Health and Safety (EHS) management, including an EHS Management System Manual, EHS Specifications and a Wastewater Management Procedure. The Environmental Management System manual contains sections on environmental strategy and emissions and waste reduction. We have procedures for assessing risk and measuring outcomes in the areas of greenhouse gas emissions, climate change, waste management, water use, packaging and environmental health and safety. Environmental key performance indicators 2019 and 2020 data is disclosed in our 2021 ESG report.

Governance

ESG. In 2021, the Company established the following governance for ESG matters. The Nominating and Governance Committee oversees all ESG matters for the Board of Directors. Led by our CEO and Founder, the executive team monitors the delivery of the business strategy, including the development and delivery of the ESG agenda. In 2021, the Company hired a Chief Sustainability Officer responsible for the day-to-day management of the enterprise ESG program. The Company is currently conducting its first materiality process review. The Company will engage key stakeholders including patients, employees, partners and investors to inform the company’s long-term ESG strategy with prioritized material topics, goals and timelines.

Code of Conduct and Ethics. The Audit Committee has oversight for all compliance and ethics matters. The Global Compliance Committee (GCC) is composed of the Chief Executive Officer, Chief Financial Officer, Chief Legal Officer and representatives from Internal Audit, R&D, Human Resources and Operations. The Chief Compliance Officer (CCO) chairs the GCC, reports organizationally to the Chief Legal Officer and functionally into the Audit Committee of the Board of Directors and is responsible for the day-to-day management of and staffing for the enterprise compliance program. The Company’s Code of Business Conduct and Ethics defines the Company’s culture and beliefs, how it conducts business worldwide, how it treats people and how it protects information and property. Everyone at the Company, including our CEO, completes the training. All employees are expected to incorporate its lessons into everything they do.

Interactions with Healthcare Professionals, Patient and Patient Organizations. Our actions and our words serve as the foundation of trust within our team, in our interactions with partners and customers and in the therapies we develop and market. Additional and full details of our principles of business behavior, policies and SOPs can be found in our Code of Conduct and Ethics, 2021 ESG report and in our Commitment to Ethical Marketing Practices Position Statement.

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EXECUTIVE OFFICERS

The following table sets forth the name, age and position of each of our executive officers as of April 1, 2022:


Name	Age	Position(s)
Samantha (Ying) Du	57	Founder, Chief Executive Officer, Chairperson of the Board of Directors
Billy Cho	44	Chief Financial Officer
F. Ty Edmondson	56	Chief Legal Officer
Harald Reinhart	70	President, Head of Global Development, Neuroscience, Autoimmune and Infectious Diseases
Alan Bart Sandler	65	President, Head of Global Development, Oncology

Biographical information for our executive officers as of April 1, 2022 is set forth below:

The biographical information of Samantha (Ying) Du, Ph.D. is set forth above under “Corporate Governance — Composition of The Board of Directors.”

Billy Cho, M.B.A., M.A. joined our Company as our Chief Financial Officer in March 2018. Prior to joining our Company, Mr. Cho served as Managing Director and Head of Asia Healthcare Investment Banking at Citigroup. Based in Hong Kong since 2011, Mr. Cho was responsible for healthcare client coverage at Citigroup across the Asia Pacific region and led many biopharma transactions in China, including Zai Lab’s U.S. initial public offering. Prior to this, he was based in New York in healthcare M&A investment banking and also spent time in corporate development for a pharmaceutical services company. Mr. Cho started his career at Ernst & Young performing financial audits of U.S.-based healthcare companies. Mr. Cho earned his M.B.A. from the Wharton School of the University of Pennsylvania in May 2011, M.S. in Accounting from the University of Virginia in 2001 and a B.S. in Business Administration from the University of Southern California’s Marshall School of Business in 2000.

F. Ty Edmondson joined our Company as Chief Legal Officer in August 2020. Mr. Edmondson has served in various legal and compliance roles during his tenure at Biogen Inc., a leading global biotech company where he has been from June 2014 through August 2020, including Senior Vice President, Chief Corporation Counsel and Assistant Secretary. During his time at Biogen, he also served as the Chief Compliance Officer, Chief Commercial Counsel and Chief International Counsel of the company. Prior to Biogen, Mr. Edmondson served as Vice President, Associate General Counsel and Corporate Secretary for Sepracor Inc., as well as in various senior legal and compliance positions in Japan and China after Sepracor’s acquisition by Sumitomo Dainippon Pharma Co., Ltd. Before Sumitomo, Mr. Edmondson served in various roles with life sciences companies with a focus on international and U.S. FDA work, including Eisai, Inc., Boston Scientific and Bristol-Myers Squibb.

Before his work in the life sciences industry, he was an associate with the admiralty law firm, Royston Rayzor in Houston, Texas. Mr. Edmondson received a BA degree in History from Washington & Lee University in June 1988 and received a J.D. from the Widener University School of Law in May 1993.

Harald Reinhart. M.D. joined our Company in May 2017 and currently serves as President, Head of Global Development, Neuroscience, Autoimmune and Infectious Diseases. He is Adjunct Clinical Professor of infectious diseases at Yale School of Medicine. Prior to joining the Company, Dr. Reinhart worked at Shionogi US as Head of Clinical Development and Medical Affairs, directing a broad portfolio of antibiotics, diabetes, allergy and pain medications. He guided several compounds through regulatory meetings and obtained approval for ospemifene. Between 2003 and 2011, he held senior roles at Novartis where he oversaw successful filings of SNDAs and NDAs for Coartem, Famvir, Sebivo and Cubicin, managed clinical development groups for infectious disease, immunity, transplantation and renal disease. He supervised the transitioning of research projects into clinical development. In the years before, he was International Clinical Project Manager in charge of

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ciprofloxacin and acarbose at Bayer Corp., with several successful SNDAs and approvals. Dr. Reinhart holds a medical degree from the University of Würzburg in Germany where he trained in anesthesiology. He completed his medical specialty training in the United States with board-certifications in internal medicine and infectious diseases.

Alan Bart Sandler, M.D. has been our President, Head of Global Development, Oncology since December 2020. Dr. Sandler brings nearly 30 years of oncology and drug development experience across industry and academia. Prior to joining Zai Lab, he was the Senior Vice President and Global Head of Product Development Oncology at Genentech, a member of the Roche Group. During his tenure at Genentech/Roche, he led the teams responsible for the global development and regulatory approval of several innovative medicines, most recently Tecentriq^®. Prior to joining Genentech/Roche, Dr. Sandler served as Professor and Chief of Hematology/Oncology at Oregon Health and Science University. Previously, he served on the faculties of the medical schools of Indiana University and Vanderbilt University. Dr. Sandler holds a Doctor of Medicine degree from Rush Medical College. He completed his training in internal medicine and a fellowship in medical oncology at Yale-New Haven Medical Center. He has published over 300 peer-reviewed publications, articles, abstracts and book chapters.

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CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

Other than compensation arrangements, we describe below any transactions and series of similar transactions, since January 1, 2021 to which we were a party or will be a party, in which:

•

the amounts involved exceeded or will exceed $120,000; and

•

any of our directors, executive officers or holders of more than 5% of our share capital or any member of the immediate family of the foregoing persons, had or will have a direct or indirect material interest.

We believe that all of the transactions described below were made on terms no less favorable to us than could have been obtained from unaffiliated third parties. Compensation arrangements for our directors and named executive officers are described in the sections of this Proxy Statement titled “Director Compensation” and “Executive Compensation.”

MEDx Research Agreement

MEDx (Suzhou) Translational Medicine Co., Ltd., or MEDx, provides product research and development services to us. We paid MEDx for services rendered $680,000 for the year ended December 31, 2021, and from January 1 to April 1, 2022, $74,000. Mr. Zhang, the Founder, Chief Executive Officer and Board member of MEDx is an immediate family member of Dr. Samantha (Ying) Du, our Founder, Chairperson and CEO.

Employment Agreements

For more information regarding employment agreements with our named executive officers, see “Executive Compensation — Employment Agreements.”

Indemnification Agreements

Cayman law does not limit the extent to which a company’s articles of association may provide indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as providing indemnification against civil fraud or the consequences of committing a crime. Our articles provide that each director and officer shall be indemnified and secured harmless out of the assets and funds of our Company against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by him or her in connection with the execution or discharge of his or her duties, powers, authorities or discretions as a director or officer of our Company, including without prejudice to the generality of the foregoing, any costs, expenses, losses or liabilities incurred by him or her in defending (whether successfully or otherwise) any civil proceedings concerning the Company or its affairs in any court whether in the Cayman Islands or elsewhere.

In addition, we have entered into indemnification agreements to indemnify our directors and executive officers that will provide such persons with additional indemnification beyond that provided in our articles. These agreements, among other things, indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer.

Registration Rights

Pursuant to a shareholders agreement, as amended and restated, certain holders of our registrable shares are entitled to rights with respect to the registration of these shares under the Securities Act of 1933, as amended, the Securities Act, including demand registration rights, short-form registration rights and piggyback registration

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rights. All fees, costs and expenses of underwritten registrations will be borne by us and all selling expenses, including underwriting discounts and selling commissions, will be borne by the holders of the shares being registered. The shareholders agreement contains customary cross-indemnification provisions, under which we are obligated to indemnify such holders of registrable securities in the event of material misstatements or omissions in the registration statement or any violation of applicable securities laws by us (except for such misstatement, omission or violation that are attributable to such holders), and such holders are obligated to indemnify us for material misstatements or omissions in the registration statement or any violation of applicable securities laws by us that are attributable to them. The registration rights granted under the shareholders agreement will terminate upon the earlier of (i) the date of completion of a deemed liquidation event, (ii) the fifth anniversary of the completion of our initial public offering (September 22, 2022) and (iii) the date such holder may sell all its registrable shares under Rule 144 of the Securities Act in any ninety-day period.

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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of the Compensation Committee has at any time during 2021 been an officer or employee of the Company. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on the Board of Directors or the Compensation Committee.

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DELINQUENT SECTION 16(A) REPORTS

Section 16(a) of the Exchange Act requires our officers and directors and persons who beneficially own more than 10% of our ordinary shares (collectively, “Reporting Persons”) to file reports of beneficial ownership and changes in beneficial ownership with the SEC. Reporting Persons are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of such reports received or written representations from certain Reporting Persons during the fiscal year ended December 31, 2021, we believe that all Reporting Persons complied with all Section 16(a) reporting requirements, with the exception of one late Form 4 filed for Harald Reinhart filed on December 27, 2021 to report a transaction that occurred on December 21, 2021; one late Form 4 filed for Frazor Titus Edmondson III filed on December 3, 2021 to report a transaction that occurred on August 17, 2021; two late Form 4 filed for Tao Fu, one filed on September 27, 2021 to report a transaction that occurred on September 15, 2021 and another filed on July 19, 2021 to report a transaction that occurred on July 15, 2021; and one late Form 4 filed for Kai-Xian Chen filed on March 30, 2021 to report a transaction that occurred on March 12, 2021.

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AUDIT COMMITTEE REPORT

The information contained in this report shall not be deemed to be (1) “soliciting material,” (2) “filed” with the SEC, (3) subject to Regulations 14A or 14C of the Exchange Act or (4) subject to the liabilities of Section 18 of the Exchange Act. This report shall not be deemed incorporated by reference into any of our other filings under the Exchange Act or the Securities Act, except to the extent that we specifically incorporate it by reference into such filing.

The Audit Committee operates under a written charter approved by the Board of Directors, which provides that its responsibilities include the oversight of the quality of our financial reports and other financial information and its compliance with legal and regulatory requirements; the appointment, compensation, and oversight of our independent registered public accounting firms for the fiscal year ended December 31, 2021, Deloitte Touche Tohmatsu Certified Public Accountants LLP and Deloitte Touche Tohmatsu, and our independent registered public accounting firm for the fiscal year ended December 31, 2022, KPMG LLP, including reviewing their independence; reviewing and approving the planned scope of our annual audit; reviewing and pre-approving any non-audit services that may be performed by Deloitte Touche Tohmatsu Certified Public Accountants LLP and Deloitte Touche Tohmatsu or by KPMG LLP; the oversight of our internal audit function; reviewing with management and our independent registered public accounting firm the adequacy of internal financial controls; and reviewing our critical accounting policies and estimates and the application of accounting principles generally accepted in the United States.

Deloitte Touche Tohmatsu Certified Public Accountants LLP is responsible for auditing our annual consolidated financial statements for the fiscal year ended December 31, 2021 filed with the SEC and internal control over financial reporting in accordance with the Exchange Act, and Deloitte Touche Tohmatsu is responsible for auditing our annual financial statements for the fiscal year ended December 31, 2021 filed with the HKEx in accordance with the HK Listing Rules. Deloitte Touche Tohmatsu Certified Public Accountants LLP and Deloitte Touche Tohmatsu are members of the global Deloitte Touche Tohmatsu Limited firm.

The Audit Committee oversees our financial reporting process on behalf of the Board of Directors. Management is responsible for our internal controls, financial reporting process, and compliance with laws and regulations and ethical business standards. Deloitte Touche Tohmatsu Certified Public Accountants LLP is responsible for performing an independent audit of our consolidated financial statements for the fiscal year ended December 31, 2021 in accordance with the standards of the Public Company Accounting Oversight Board (United States). The Audit Committee’s main responsibility is to monitor and oversee this process.

The Audit Committee reviewed and discussed with management our audited financial statements for the fiscal year ended December 31, 2021. The Audit Committee discussed with Deloitte Touche Tohmatsu Certified Public Accountants LLP the matters required to be discussed by Public Company Accounting Oversight Board (the “PCAOB”), Auditing Standard No. 1301, Communications with Audit Committees, and SEC Regulation S-X Rule 207, Communications with Audit Committees. The Audit Committee has received the written disclosures and the letter from the independent registered public accounting firms required by applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firms their independence.

The Audit Committee considered any fees paid to Deloitte Touche Tohmatsu Certified Public Accountants LLP and Deloitte Touche Tohmatsu for the provision of non-audit related services and does not believe that these fees compromise Deloitte Touche Tohmatsu Certified Public Accountants LLP’s or Deloitte Touche Tohmatsu’s independence in performing the audit.

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Based on the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that such audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the SEC on March 1, 2022.

AUDIT COMMITTEE

John Diekman, Chair

Peter Wirth

Scott Morrison

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

SEC Form DEF 14A filed by Zai Lab Limited