oeg20220520_pre14a.htm

DEF 14A 1 oeg20220531_def14a.htm FORM DEF 14A oeg20220520_pre14a.htm

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

Schedule 14A

Proxy Statement Pursuant to Section 14(a)

of the Securities Exchange Act of 1934

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 Pursuant to §240.14a-11(c) of §240.14a-12

Orbital Energy Group, Inc.

(Name of Registrant as Specified in its Charter)

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

Not applicable

Payment of Filing Fee (Check all boxes that apply):

	☒	No fee required.

	☐	Fee paid previously with preliminary materials

	☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

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June 2, 2022

Dear Fellow Shareholders,

Orbital Energy Group continues to make steady progress executing on our strategy to become a premier provider of infrastructure services to the electric power, telecommunications, and renewable industries. 2021 was a year of transformation, positioning the company for significant revenue growth and a move to profitability in 2022. We entered this year with a record backlog and expect revenues to increase upwards toward 500% for the full year of 2022 compared to last year. We also expect to achieve positive adjusted EBITDA for 2022 for the first time in the company’s history.

Our transformation in 2021 is largely attributed to completing several accretive strategic acquisitions to enhance our electric power operations and establish our position in the telecommunication industry. Additionally, we reorganized Orbital Solar to become a viable service provider to the utility scale solar industry. At the same time, we moved our legacy Orbital Gas System businesses in both the United Kingdom and in Houston to discontinued operations. In May of this year, we sold the U.K. operation and are pursuing the same path for Orbital Gas Systems in Houston.

Orbital Energy Group is now positioned for profitable revenue growth and increasing shareholder value, organized under three operating segments: electric power, telecommunications, and renewables.

Our electric power segment was significantly enhanced by acquiring Front Line Power Construction (FLP), in November of last year. FLP, located in Rosharon, Texas, was founded in 2010, and is a proven provider of electric distribution and substation services to investor-owned electric utility customers. Our electric power segment is now well suited to leverage the favorable, long term market drivers, specifically, increasing demand from grid modernization, storm hardening, the interconnection of renewable energy, and the electrification of our nation, more specifically electric transportation.

Our telecommunication segment was established with the acquisition of Gibson Technical Services (GTS), last spring. GTS, located outside of Atlanta, Georgia, was founded in 1990 and provides engineering, design, construction, and maintenance services to broadband and wireless customers in the telecommunications, healthcare, and entertainment industries. Subsequent to the GTS acquisition, we acquired two synergistic ‘tuck-in’ acquisitions, IMMCO and Full Moon Telecommunications, to expand our service offerings to our telecommunications customers. During the year, we were awarded several significant projects which, in total, comprise our building an 11,000-mile fiber network to rural communities over a five-state area. The rollout of the 5G spectrum, enhancement of 4G/LTE networks and the federal and state funded programs to bring fiber to rural Americans is expected to provide significant growth opportunities for our telecommunication segment for years to come.

Finally, our renewable segment, which began with a small strategic acquisition in April of 2020, transformed during 2021, with the primary objective of strengthening the capabilities of Orbital Solar Services to be a viable service provider to the utility scale solar industry. As a result, we were awarded two, 100MW+ solar programs in the second half of last year, that are now under construction with a pipeline of project opportunities, in excess of a billion dollars, to pursue and evaluate going forward. The renewable industry is driven by federal and state mandates to move the nation to a zero-carbon emission footprint and away from fossil fuel energy generation over the next several decades. Orbital Solar Services is now fully capable of leveraging the opportunity to engineer, procure, and construct utility solar programs across the nation as the country transitions to a renewable generation future.

Orbital Energy Group is building a successful infrastructure services platform, with strong, multi-year market drivers across all of the industries we serve. However, we would not be successful without our dedicated, hard-working, highly skilled employees, who represent the OEG brand each and every day, often working in challenging conditions, while providing service excellence to our customers. I thank each of you for your contributions as well as your family members that support your commitment to our craft.

As a fellow shareholder, I recognize that our share price is below expectations and we need to optimize our capital structure, with a portion of our debt due at the end of the year. However, I am confident, as we continue to successfully execute our strategy and deliver improving financial results, that we will have the opportunity to restructure our debt to more favorable terms and generate improved shareholder value going forward.

In closing, the infrastructure company I envisioned building when joining the company two- and one-half years ago is materializing, as we made the necessary acquisitions and internal organizational restructuring last year to create a solid foundation to build from. Our priorities at Orbital Energy Group are clear: enhance shareholder value by increasing profitable revenues through safe and solid execution by our skilled workforce, while building our backlog of business, in a robust end market environment in the industries we serve.

I thank our investors for their continued confidence in the management team and look forward to a successful 2022 and beyond.

Respectfully,

/s/ Jim O'Neil

Jim O’Neil

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Notice of Annual Meeting of Stockholders

July 21, 2022

To: The Stockholders of Orbital Energy Group, Inc.

We will hold a 2022 Annual Meeting of Stockholders at 9:00 am CST on Thursday, July 21, 2022, at Orbital Energy Group, Inc., 1924 Aldine Western, Houston, Texas 77038 (the “Annual Meeting”) for the following purposes:

Election of eight directors to hold office until the 2023 Annual Meeting of Stockholders or until their respective successors have been duly elected and qualified;

Ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022;

Advisory approval of the Company’s executive compensation (Say-on-Pay);

To approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the number of shares for issuance by 5,000,000 shares;

To approve the conversion of the Company’s domicile state from Colorado to Texas which conversion shall include changing the corporate name from Orbital Energy Group, Inc. to Orbital Infrastructure Group, Inc. and

To transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.

Our board of directors recommends that you vote FOR the election of each of the directors and Proposals 2, 3, 4 and 5.

These items of business are more fully described in the proxy statement accompanying this notice. The board of directors has fixed the close of business on May 27, 2022, as the Record Date for the determination of stockholders entitled to receive notice of, and to vote at, the Annual Meeting of Stockholders. For a period of at least ten days prior to the Annual Meeting, a complete list of stockholders entitled to vote at the Annual Meeting will be open to examination by any stockholder during ordinary business hours at the offices of the Company, 1924 Aldine Western, Houston, Texas 77038.

Your vote is especially important. All stockholders are cordially invited to attend the Annual Meeting. Whether or not you plan to attend the Annual Meeting, we encourage you to read this proxy statement and submit your proxy or voting instructions as soon as possible. For specific instructions on how to vote your shares, please refer to the instructions on the Notice of Internet Availability of Proxy Materials (the “Notice”) you received in the mail, the section entitled General Information about the Annual Meeting beginning on page 1 of the proxy statement or, if you requested to receive printed proxy materials, your enclosed proxy card.

To assure your representation at the Annual Meeting of Stockholders, we ask that you vote as promptly as possible.

Your stock will be voted in accordance with the instructions you provide in your proxy. You may revoke your proxy at any time before it is voted by signing and returning a proxy bearing a later date for the same shares, by filing with the Secretary of the Company a written revocation bearing a later date or by attending and voting in person at the Annual Meeting.

	By Order of the Board of Directors

	James F. O’Neil, CEO

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Proxy Statement

Introduction

This proxy statement is furnished in connection with the solicitation of proxies by the board of directors of Orbital Energy Group, Inc. (the “Company", “we”, “us”, “OEG”) for use at the Annual Meeting of Stockholders to be held at 9:00 am CST on Thursday, July 21, 2022, at the Orbital Energy Group, Inc. offices located at 1924 Aldine Western, Houston, Texas 77038 and for any postponements or adjournments thereof. Please vote your shares of Orbital Energy Group common stock. Your vote at the Annual Meeting is important to us. Whether or not you plan to attend the Annual Meeting, we encourage you to read this proxy statement and submit your proxy or voting instructions as soon as possible. For specific instructions on how to vote your shares, please refer to the instructions on the Notice of Internet Availability of Proxy Materials (the “Notice”) you received in the mail, the section entitled General Information about the Annual Meeting beginning below in this proxy statement or, if you requested to receive printed proxy materials, your enclosed proxy card. The proxy statement and the accompanying materials are being made available to the stockholders on or about June 2, 2022. This solicitation of proxies is made on behalf of our board of directors.

WE URGE YOU TO VOTE AS SOON AS POSSIBLE, EVEN IF YOU ARE CURRENTLY INTENDING TO ATTEND THE MEETING. THIS WILL NOT PREVENT YOU FROM VOTING IN PERSON, BUT WILL ASSURE THAT YOUR VOTE IS COUNTED IF YOU ARE UNABLE TO ATTEND THE MEETING. IT IS IMPORTANT THAT YOUR SHARES ARE REPRESENTED AT THE MEETING IN PERSON OR BY PROXY. IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE PROXY CARD (WHICH WILL BE MADE AVAILABLE TO YOU SEPARATELY) OR PROVIDE VOTING INSTRUCTIONS BY TELEPHONE OR VIA THE INTERNET.

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Contents

General Information about the Annual Meeting	3
Proposals to be Considered	11
PROPOSAL I	11
PROPOSAL II	17
PROPOSAL III	18
PROPOSAL IV	19
PROPOSAL V	23
Comparison of Shareholder Rights Before and After the Conversion	27
Corporate Overview	43
Directors and Executive Officers	44
Environmental, Social and Governance (ESG)	46
Corporate Governance and Board of Directors Matters	47
Committees of the Board of Directors	51
Compensation Discussion and Analysis	57
Compensation Setting Process	58
Outstanding Equity Awards at Fiscal Year End	66
Director Compensation	67
Security Ownership of Certain Beneficial Owners and Management	68
Related Party Transactions	69
Appendix	74
Annex A (“Excerpt from Orbital Energy Group 2020 Incentive Award Plan”)	1
Annex B (“Plan of Conversion”)	2
Annex C (“Colorado Statement of Conversion”)	7
Annex D (“Texas Certificate of Conversion”)	9
Annex E (the “Certificate of Formation”)	10
Annex F (“Texas Bylaws”)	16
Annex G (“Texas Indemnification Agreement”)	58

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General Information about the Annual Meeting

Q: Why am I receiving these materials?

A: Our board of directors has made these materials available to you on the internet or, upon your request, delivered printed proxy materials to you in connection with the solicitation of proxies for use at the Orbital Energy Group Annual Meeting of Stockholders, which will take place at 9:00 am CST on Thursday, July 21, 2022, at Orbital Energy Group, Inc., 1924 Aldine Western, Houston, Texas 77038. As a stockholder, you are invited to attend the Annual Meeting and you are requested to vote on the items of business described in this proxy statement.

Q: What information is contained in this proxy statement?

A: The information in this proxy statement relates to the proposals to be voted on at the Annual Meeting, the voting process, the compensation award process of our directors and most highly paid executive officers, a description of an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan to increase the Overall Share Limit by 5,000,000 shares, ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022, conversion of the Company’s domicile state from Colorado to Texas, change of the corporate name from Orbital Energy Group, Inc. to Orbital Infrastructure Group, Inc., corporate governance and information on our board of directors and certain other required information.

Q: Why did I receive a notice in the mail regarding the internet availability of proxy materials instead of a full set of proxy materials?

A: In accordance with rules adopted by the Securities and Exchange Commission (the “SEC”), we may furnish proxy materials, including this proxy statement and our 2021 Annual Report on Form 10-K and 10-K/A and our most recent Form 10-Q, to our stockholders by providing access to such documents on the internet instead of mailing printed copies. Most stockholders will not receive printed copies of the proxy materials unless they request them. Instead, the Notice, which was mailed to most of our stockholders, will instruct you as to how you may access and review all the proxy materials on the internet. The Notice also instructs you as to how you may submit your proxy on the internet. If you would like to receive a paper or email copy of our proxy materials, you should follow the instructions in the Notice for requesting such materials.

Q: I share an address with another stockholder and we received only one paper copy of the proxy materials. How may I obtain an additional copy of the proxy materials?

A: We have adopted a procedure called “householding,” which the SEC has approved. Under this procedure, we deliver a single copy of the Notice and, if applicable, the proxy materials and the Annual Report to Stockholders to multiple stockholders who share the same address unless we received contrary instructions from one or more of the stockholders. This procedure reduces environmental impact as well as our printing costs, mailing costs and fees. Stockholders who participate in householding will continue to be able to access and receive separate proxy cards. Upon written request, we will promptly deliver a separate copy of the Notice and, if applicable, the proxy materials and the 2021 Annual Report on Form 10-K and 10-K/A and the most recent Form 10-Q to any stockholder at a shared address to which we delivered a single copy of any of these documents. To receive a separate copy of the Notice and, if applicable, these proxy materials or the 2021 Annual Report on Form 10-K and 10-K/A and the most recent Form 10-Q, stockholders may telephone, write or email us as follows: (832) 467‑1420, Orbital Energy Group, Inc., 1924 Aldine Western, Houston, Texas 77038; Investors@OrbitalEnergyGroup.com.

Stockholders who hold shares in street name (as described below) may contact their brokerage firm, bank, broker-dealer or other similar organization to request information about householding.

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Q: How do I get electronic access to the proxy materials?

A: The Notice will provide you with instructions regarding how to:

•

View our proxy materials for the Annual Meeting on our website, www.OrbitalEnergyGroup.com and

•

Instruct us to send our future proxy materials to you electronically by email.

Choosing to receive your future proxy materials by email will save us the cost of printing and mailing documents to you and will reduce the impact on the environment of printing and mailing these materials. If you choose to receive future proxy materials by email, you will receive an email next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by email will remain in effect until you terminate it.

Q: Is the Annual Meeting going to be webcast?

A: For your convenience, we are pleased to offer a live webcast of our Annual Meeting on the Investor Relations section of our website at www.OrbitalEnergyGroup.com.

Q: Can I participate in the question-and-answer portion of the Annual Meeting without attending the Annual Meeting?

A: No. The live webcast will be only visual and audio; there will be no opportunity to participate in the question-and-answer portion of the Annual Meeting unless you are present at the meeting.

Q: What items of business will be voted on at the 2022 Annual Meeting?

A: The items of business scheduled to be voted on at the Annual Meeting are:

●

Election of eight directors to hold office until the 2023 Annual Meeting of Stockholders or until their respective successors have been duly elected and qualified;

●

Ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022;

●

Advisory approval of the Company’s executive compensation (Say-on-Pay);

●

To approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the number of shares for issuance by 5,000,000 shares;

●

To transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.

Q: How can I vote my shares in person at the Annual Meeting?

A: Shares held in your name as the stockholder of record may be voted by you in person at the Annual Meeting. Shares held beneficially in street name may be voted by you in person at the Annual Meeting only if you obtain a legal proxy from the broker, bank, trustee or nominee that holds your shares giving you the right to vote the shares. Even if you plan to attend the Annual Meeting, we recommend that you also submit your proxy or voting instructions as described herein so that your vote will be counted if you later decide not to attend the meeting.

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Q: How shall I sign my name on the proxy card?

A: The following general rules for signing proxy cards may be of assistance to you and avoid the time and expense to Orbital Energy Group in validating your vote if you fail to sign your proxy card properly.

•

Individual Accounts: Sign your name exactly as it appears in the registration on the proxy card.

•

Joint Accounts: Either party may sign, but the name of the party signing should conform exactly to a name shown in the registration on the proxy card.

•

All Other Accounts: The capacity of the individual signing the proxy card should be indicated unless it is reflected in the form of registration.

Q: How can I vote my shares without attending the Annual Meeting?

A: Whether you hold shares directly as the stockholder of record or beneficially in street name, you may direct how your shares are voted without attending the Annual Meeting. If you are a stockholder of record, you may vote by proxy. You can vote by proxy over the internet by following the instructions provided in the Notice or, if you requested to receive printed proxy materials, you can also vote by mail or telephone pursuant to instructions provided on the proxy card. If you hold shares beneficially in street name, you may also vote by proxy over the internet by following the instructions provided in the Notice or, if you requested to receive printed proxy materials, you can also vote by telephone or mail by following the voting instruction card provided to you by your broker, bank, trustee or nominee.

Q: May I change my vote?

A: You may change your vote at any time prior to the taking of the vote at the Annual Meeting. If you are the stockholder of record, you may change your vote by: (1) granting a new proxy bearing a later date (which automatically revokes the earlier proxy) using any of the methods described above (and until the applicable deadline for each method), (2) providing a written notice of revocation to Orbital Energy Group’s Corporate Secretary at Orbital Energy Group, Inc., 1924 Aldine Western, Houston, Texas 77038 prior to your shares being voted or (3) attending the Annual Meeting and voting in person. Attendance at the meeting will not cause your previously granted proxy to be revoked unless you specifically so request. For shares you hold beneficially in street name, you may change your vote by submitting new voting instructions to your broker, bank, trustee or nominee following the instructions they provided or, if you have obtained a legal proxy from your broker, bank, trustee or nominee giving you the right to vote your shares, by attending the Annual Meeting and voting in person.

Q: Is my vote confidential?

A: Proxy instructions, ballots and voting tabulations that identify individual stockholders are handled in a manner that protects your voting privacy. Your vote will not be disclosed either within Orbital Energy Group or to third parties, except: (1) as necessary to meet applicable legal requirements, (2) to allow for the tabulation of votes and certification of the votes and (3) to facilitate a successful proxy solicitation. Occasionally, stockholders provide on their proxy card written comments, which are then forwarded to Orbital Energy Group management.

Q: How many shares must be present or represented to conduct business at the Annual Meeting?

A: The presence at the Annual Meeting, in person or by proxy, of the holders of one third of the aggregate voting power of the common stock outstanding on the Record Date will constitute a quorum. Each share of common stock is entitled to one vote. As of the Record Date for this Annual Meeting, approximately 86,876,540 shares of common stock were outstanding and entitled to vote at the Annual Meeting. Both abstentions and broker non-votes (described below) are counted for the purpose of determining the presence of a quorum. Unless otherwise indicated, all references herein to percentages of outstanding shares of stock are based on such numbers of shares outstanding. Shares entitled to vote are referred to hereafter as “Voting Shares.”

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Q: What shares can I vote?

A: Each share of Orbital Energy Group common stock issued and outstanding as of the close of business on the Record Date for the Annual Meeting is entitled to be voted on all items being voted on at the Annual Meeting. You may vote all shares owned by you as of the Record Date, including: (1) shares held directly in your name as the stockholder of record and (2) shares held for you as the beneficial owner in street name through a broker, bank, trustee or other nominee.

Q: How many votes am I entitled to per share?

A: Each holder of shares of common stock is entitled to one vote for each share held as of the Record Date.

Q: What is the Record Date?

A: Record Date, in the context of voting at the Annual Meeting, is the date on which our stock ledger is closed for the purpose of determining which stockholders officially own voting shares in order to be entitled to vote at the Annual Meeting. The Record Date for the 2022 Annual Meeting of Stockholders is May 27, 2022.

Q: How may I vote?

A: Regarding the election of directors, you may vote “FOR” all or some of the nominees or your vote may be “WITHHELD” with respect to one or more of the nominees.

A: Regarding the following proposals, you may vote “FOR” or “AGAINST” or “ABSTAIN”:

●

Ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022;

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Advisory approval of the Company’s executive compensation (Say-on-Pay);

●

To approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the number of shares for issuance by 5,000,000 shares;

●

Q: If I check the box for “ABSTAIN” or “WITHHOLD,” what happens to my vote?

A: If you check the box for “ABSTAIN” or “WITHHOLD,” your vote will not be counted in favor of the matter on which you voted; however, it will be counted for the purpose of determining the presence of a quorum.

Q: What vote is required to approve each item?

A: Election of directors

The affirmative vote “FOR” of a simple majority of the votes cast at the Annual Meeting is required for the election of each director. A properly executed proxy marked "WITHHOLD" with respect to the election of one or more directors will not be voted with respect to the director or directors indicated or the other items to be voted on; however, it will be counted for purposes of determining whether there is a quorum. Voting Shares represented by properly executed proxies for which no instruction is given will be voted “FOR” election of the nominee for director.

A: Ratification of Grant Thornton LLP as our independent registered public accounting firm.

The affirmative vote “FOR” of a simple majority of the votes cast at the Annual Meeting is required for the ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the year ending December 31, 2022. A properly executed proxy marked “ABSTAIN” regarding this issue will not be voted with respect to the item to be voted on; although, it will be counted for purposes of determining whether there is a quorum. Voting Shares represented by properly executed proxies for which no instruction is given will be voted “FOR” these issues.

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A: Advisory vote on the approval of the Company’s executive compensation (Say-on-Pay).

While we intend to carefully consider the voting results of this proposal, in accord with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the final vote is advisory in nature, therefore, not binding on us, our board or the Compensation Committee. Our executive compensation will be approved, on an advisory basis, if the votes cast by stockholders in favor of advisory approval exceed those votes cast in opposition of advisory approval.

A: To approve the conversion of the Company’s domicile state from Colorado to Texas.

The affirmative vote “FOR” of a simple majority of the votes cast at the Annual Meeting is required to approve the conversion of the Company’s domicile state from Colorado to Texas. A properly executed proxy marked "WITHHOLD" with respect to this proposal will not be voted with respect to approval of this proposal; however, it will be counted for purposes of determining whether there is a quorum. Voting Shares represented by properly executed proxies for which no instruction is given will be voted “FOR” approval of the conversion of the Company’s domicile state from Colorado to Texas.

A: To approve the change of the corporate name from Orbital Energy Group, Inc. to Orbital Infrastructure Group, Inc.

The affirmative vote “FOR” of a simple majority of the votes cast at the Annual Meeting is required to approve the company name change. A properly executed proxy marked "WITHHOLD" with respect to this proposal will not be voted with respect to approval of this proposal; however, it will be counted for purposes of determining whether there is a quorum. Voting Shares represented by properly executed proxies for which no instruction is given will be voted “FOR” approval of the company name change.

A: To approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the Overall Share Limit by 5,000,000 shares.

The affirmative vote “FOR” of a simple majority of the votes cast at the Annual Meeting is required to approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the Overall Share Limit. A properly executed proxy marked "WITHHOLD" with respect to this proposal will not be voted with respect to approval of this proposal; however, it will be counted for purposes of determining whether there is a quorum. Voting Shares represented by properly executed proxies for which no instruction is given will be voted “FOR” approval of an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the Overall Share Limit.

Q: Why am I asked to approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the Overall Share Limit to 5,000,000?

A: Nasdaq Stock Market Listing Rule 5635(c) requires shareholder approval prior to the issuance of securities when a stock option or purchase plan is to be established or materially amended or other equity compensation arrangement is made or materially amended, pursuant to which stock may be acquired by officers, directors, employees, or consultants.

We had two previous equity incentive plans, 2008 Equity Incentive Plan and the Company’s 2009 Equity Incentive Plan (Executive), which have both expired.

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Q: What is the purpose of the Orbital Energy Group 2020 Incentive Award Plan and what is in it?

A: Orbital Energy Group is requesting its stockholders to approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan (the “Plan”) by increasing the Overall Share Limit from 5,000,000 to 10,000,000 shares of which 1,476,450 have been granted. The Overall Share Limit is the total number of shares reserved and available for grant and issuance pursuant to the Plan. By the terms of the Plan, the Company shall reserve and keep available a sufficient number of shares as shall be required to satisfy the requirements of all outstanding awards granted under the Plan. This increase will become effective upon stockholder approval.

The purpose of the Orbital Energy Group 2020 Incentive Award Plan is to enhance our ability to attract, retain and motivate persons who make (or are expected to make) important contributions to Orbital Energy Group by providing these individuals with equity ownership opportunities. Equity awards are intended to motivate high levels of performance and align the interests of our directors, employees and consultants with those of our stockholders by giving directors, employees and consultants the perspective of an owner with an equity stake in Orbital Energy Group and providing a means of recognizing their contributions to the success of the Company. Our board of directors and management believe that equity awards are necessary to remain competitive in the Company’s industry and are essential to recruiting and retaining the highly qualified employees who help Orbital Energy Group meet its goals.

Q: What is the effect of the proposal to ratify the Audit Committee’s appointment of Grant Thornton LLP as our independent registered public accounting firm?

A: Selection of our independent registered public accounting firm is not required to be submitted to a vote of stockholders. The Sarbanes-Oxley Act of 2002 requires the Audit Committee of our board of directors to be responsible for the appointment, compensation and oversight of the audit work of the independent registered public accounting firm. However, the board of directors has elected to submit the selection of Grant Thornton LLP as our independent registered public accounting firm to stockholders for ratification as a matter of corporate practice. If the stockholders fail to ratify the appointment, the Audit Committee will reconsider whether to retain Grant Thornton LLP and may retain that firm or another firm without resubmitting the matter to our stockholders. Even if the appointment is ratified, the Audit Committee may, at its discretion, appoint a different independent registered public accounting firm at any time during the year.

Q: What is the reason for and the effect of the proposal to approve the conversion of the Company’s domicile state from Colorado to Texas?

A: The primary reason that the Board has approved and recommended the Conversion is because the corporate executive offices and core of operations are located in Houston, Texas and the corporate laws of the State of Texas are more conducive to our method of operation. The principal effects of the Conversion will be that:

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The corporate name will change from Orbital Energy Group, Inc. to Orbital Infrastructure Group, Inc.

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The affairs of the Company will cease to be governed by the Colorado Corporations and Associations Act (the “CCAA”) and its existing articles of incorporation and bylaws (the "Colorado Articles" and the "Colorado Bylaws") will become subject to the Texas Business Organizations Code (the “TBOC”).

●

The resulting Texas corporation (“Orbital Infrastructure Group, Inc.”) will be the same entity of the Company as currently incorporated in Colorado (“Orbital Energy Group, Inc.”), will possess all of the properties of Orbital Energy Group, Inc., will continue with all of the debts, liabilities and obligations of Orbital Energy Group, Inc. and will continue with the same officers and directors of Orbital Energy Group, Inc. immediately prior to the Conversion, as more fully described below.

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●

When the conversion becomes effective, all of the issued and outstanding shares of common stock of Orbital Energy Group, Inc. will be automatically converted into issued and outstanding shares of common stock of Orbital Infrastructure Group, Inc., on a one for one basis, without any action on the part of our shareholders. The Conversion will have no effect on the trading of our stock on the Nasdaq Capital Market tier of The Nasdaq Stock Market under the new symbol “OIG”. Orbital Infrastructure Group, Inc. will continue to file periodic reports and other documents as and to the extent required by the rules and regulations of the SEC. Shares of our common stock that are freely tradeable prior to the Conversion will continue to be freely tradeable as shares of Orbital Infrastructure Group, Inc. common stock, and shares of our common stock that are subject to restrictions prior to the Conversion will continue to be subject to the same restrictions as shares of Orbital Infrastructure Group, Inc. common stock. The Conversion will not change the respective positions of Orbital Energy Group or our shareholders under federal securities laws.

●

Upon effectiveness of the conversion, all of our employee benefit and incentive plans will become Orbital Infrastructure Group, Inc. plans, and each option, restricted stock unit, equity award or other right issued under such plans will automatically be converted into an option, restricted stock unit, equity award or right to purchase or receive the same number of shares of Orbital Infrastructure Group, Inc. common stock, at the same price per share, upon the same terms and subject to the same conditions as before the Conversion. In addition, our employment contracts and other employee benefit arrangements also will be continued by Orbital Infrastructure Group, Inc. upon the same terms and subject to the same conditions in effect at the time of the Conversion.

Q: Is cumulative voting permitted for the election of directors?

A: No. You may not cumulate your votes for the election of directors.

Q: What is cumulative voting?

A: A system of voting in which each voter is given as many votes as there are positions to be filled and allowed to cast those votes for one candidate or distribute them in any way among the candidates.

Q: What happens if additional matters are presented at the Annual Meeting?

A: Other than:

●

Election of eight directors to hold office until the 2023 Annual Meeting of Stockholders or until their respective successors have been duly elected and qualified;

●

Ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022;

●

Advisory approval of the Company’s executive compensation (Say-on-Pay);

●

To approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the number of shares for issuance by 5,000,000 shares;

●

To transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.

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As described in this proxy statement, we are not aware of any other business to be acted upon at the Annual Meeting. If you submit a signed proxy, the persons named as proxy will have the discretion to vote your shares on any additional matters properly presented for a vote at the meeting.

Q: What is the difference between holding shares as a stockholder of record and as a beneficial owner?

A: Many Orbital Energy Group stockholders hold their shares as a beneficial owner through a broker or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held as a stockholder of record and those owned beneficially.

Stockholder of Record

If your shares are registered directly in your name with our transfer agent, Computershare Trust Company, N.A., you are considered, with respect to those shares, the stockholder of record, and the Notice was sent directly to you by Orbital Energy Group. As the stockholder of record, you have the right to grant your voting proxy directly to Orbital Energy Group or to vote in person at the Annual Meeting. If you requested to receive printed proxy materials, Orbital Energy Group has enclosed or sent a proxy card for you to use. You may also vote on the internet or by telephone, as described in the Notice and below under the heading “How can I vote my shares without attending the Annual Meeting?”

Beneficial Owner

If your shares are held in an account at a brokerage firm, bank, broker-dealer, trust or other similar organization, like most of our stockholders, you are considered the beneficial owner of shares held in street name, and the Notice was forwarded to you by that organization. As the beneficial owner, you have the right to direct your broker, bank, trustee or nominee how to vote your shares and you are also invited to attend the Annual Meeting.

Since a beneficial owner is not the stockholder of record, you may not vote your shares in person at the Annual Meeting unless you obtain a “legal proxy” from the broker, bank, trustee or nominee that holds your shares giving you the right to vote the shares at the meeting. If you do not wish to vote in person or you will not be attending the Annual Meeting, you may vote by proxy. You may vote by proxy over the internet or by telephone, as described in the Notice and below under the heading “How can I vote my shares without attending the Annual Meeting?”

If you hold your shares in "street name” through a broker or other nominee, your broker or nominee may not be permitted to exercise voting discretion with respect to non-routine matters to be acted upon which includes Proposals 1, 2, 3, 4, and 5. Thus, if you do not give your broker or nominee specific instructions, your shares may not be voted on those matters and will not be counted in determining the number of shares necessary for approval. Shares represented by such "broker non-votes" will, however, be counted in determining whether there is a quorum.

Q: Who will bear the cost of soliciting votes for the Annual Meeting?

A: Orbital Energy Group will pay the entire cost of preparing, assembling, printing, mailing and distributing these proxy materials and soliciting votes. If you choose to access the proxy materials and/or vote over the internet, you are responsible for internet access charges you may incur. If you choose to vote by telephone, you are responsible for telephone charges you may incur. In addition to the mailing of these proxy materials, the solicitation of proxies or votes may be made in person, by telephone or by electronic communication by our directors, officers and employees, who will not receive any additional compensation for such solicitation activities.

Q: Where can I find the voting results of the Annual Meeting?

A: We intend to announce preliminary voting results at the Annual Meeting and to disclose the vote results on Form 8-K as well as on our website at www.OrbitalEnergyGroup.com as soon as possible after the Annual Meeting.

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Proposals to be Considered

PROPOSAL I

Election of Directors

Issued and outstanding shares of our Common Stock are entitled to one vote per share for each Director for a one-year term or until a successor has been elected and qualified or the Director’s earlier resignation or removal. Cumulative voting is not permitted.

Unless stated to be voted otherwise, each proxy will be voted for the election of the nominees named. The nominees have consented to serve as director if elected. If any nominee becomes unavailable for election before the Annual Meeting of Stockholders, the board of directors may name a substitute nominee and proxies will be voted for such substitute nominee unless an instruction to the contrary is written on the proxy card.

Information about Director Nominees

Board of Directors Independence

The board of directors has determined that each of the director nominees standing for election has no relationship that, in the opinion of the board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Additionally, several of the director nominees standing for election are “independent directors” as defined by Rule 5605(a)(2) of The Nasdaq Stock Market (“Nasdaq”). In determining the independence of our directors, the board of directors has adopted independence standards that mirror exactly the criteria specified by applicable laws and regulations of the SEC and the Rules of The Nasdaq Stock Market. In determining the independence of our directors, the board of directors considered all transactions in which Orbital Energy Group and any director had any interest, including those discussed below under Related Party Transactions.

Paul D. White Retired from the Board

Paul D. White, has elected to retire from our board of directors when his term expires and will not stand for reelection at the Company’s annual meeting in 2022.

Following is a brief description of the business experiences, ages as of December 31, 2022, and positions and offices with the Company for each of the director nominees.

William J. Clough, Esq. Executive Chairman of the board of directors and Chief Legal Officer of the Company and its wholly owned subsidiaries, age 71. Mr. Clough has served on the board of directors since 2006 and was reelected at the 2021 Annual Meeting of Stockholders to serve a one-year term.

A seasoned executive and entrepreneur, Mr. Clough joined the company’s Board in 2006 and was subsequently appointed chief executive officer in 2008. In his role as CEO, a position he held until 2019 with the appointment of Jim O’Neil, he led the establishment of the company’s Energy division, formed its Energy operations in North America, and guided the company to its largest Energy contract award in its history while concurrently managing the company’s Power & Electro-Mechanical division to greater than average electronics industry growth rates in recent years. As CEO, he directed company’s capital markets strategy, including leading several equity offerings to institutional investors and spearheaded the company’s uplist to the Nasdaq Capital Market in 2012.

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Mr. Clough previously founded and operated a multi-state, multi-office law firm for 14 years. He received a Juris Doctorate, Cum Laude, from the University of California’s Hastings College of Law in 1990. He is a former law enforcement officer and U.S. Federal Air Marshal. Mr. Clough serves on the board of directors of privately-held Virtual Power Systems, creator of Software Defined Power®, in which Orbital Energy Group holds a minority equity investment.

James F. O’Neil III, Vice Chairman of the board of directors and Chief Executive Officer of the Company and its wholly owned subsidiaries, age 64. Mr. O’Neil was appointed to the Board of Directors in July 2019 and reelected at the 2021 Annual Meeting of Stockholders to serve a one-year term.

James (Jim) O'Neil joined Orbital Energy Group as vice chairman in July 2019 and was subsequently appointed chief executive officer in October 2019. He is a veteran executive of the power industry and has been instrumental in formulating and is overseeing execution on Orbital Energy Group’s transformation plan that reshapes the company into a diversified energy services platform.

Mr. O’Neil was previously chief operating officer, chief executive officer and president of Quanta Services, Inc. (Quanta) from 2008 to 2016, an infrastructure solutions provider for the electric power, oil and natural gas, telecommunications and renewable industries. During this period, he grew the company into a Fortune 500 enterprise with $7+ billion in annual revenue at its peak through a combination of both organic growth and many strategic acquisitions.

Mr. O’Neil joined Quanta in 1999 and over his tenure was responsible for various initiatives including the company’s growth strategy, internal audit, and merger and acquisition initiatives. He began his career at Halliburton Company in 1980 where he held various positions, lastly as Director, Global Deepwater Development.

Mr. O’Neil holds a B.S. in Civil Engineering from Tulane University.

C. Stephen Cochennet, Director, age 65

Mr. Cochennet was elected to serve as a director at the 2018 Annual Meeting and continues to serve on the board of directors as an independent director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market. Mr. Cochennet was reelected at the 2021 Annual Meeting of Stockholders to serve a one-year term.

Mr. Cochennet, as an independent director, serves on the nominating committee along with Messrs. Lambrecht, Addison, Williams, Ms. Thornton and Ms. Tucker. Mr. Cochennet is also a member of our Audit Committee, Compensation Committee and Investment Committee.

Mr. Cochennet has served as CEO/President, of Kansas Resource Development Company, a private oil and gas exploration company since 2011. From 2011 through 2015 he was also the CEO and president of Guardian 8 Corporation. From 2005 to 2010 Mr. Cochennet was the Chairman, President, and Chief Executive Officer of EnerJex Resources, Inc., a publicly traded SEC registered Oil and Gas Company. Prior to joining EnerJex, Mr. Cochennet was President of CSC Group, LLC in which he supported several Fortune 500 corporations, international companies, and natural gas/electric utilities as well as various startup organizations. The services provided included strategic planning, capital formation, corporate development, executive networking and transaction structuring. From 1985 to 2002, he held several executive positions with UtiliCorp United Inc. (Aquila) in Kansas City, Missouri. His responsibilities included finance, administration, operations, human resources, corporate development, natural gas/energy marketing, and managing several new startup operations. Prior to his experience at Aquila Mr. Cochennet served 6 years with the Federal Reserve System managing problem and failed banking institutions primarily within the oil and gas markets.

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Mr. Cochennet graduated from the University of Nebraska with a B.A. in Finance and Economics.

Corey A. Lambrecht, Director, age 53

Mr. Lambrecht was elected to serve as a director at the 2007 Annual Meeting of Stockholders and continues to serve on the board of directors as an independent director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market. Mr. Lambrecht was reelected at the 2021 Annual Meeting to serve a one-year term.

Mr. Lambrecht, as an independent director, serves on the nominating committee along with Messrs. Cochennet, Addison, Williams, Ms. Thornton and Ms. Tucker. Mr. Lambrecht is also Chairman of our Compensation Committee and Investment Committee and a member of our Audit Committee.

Mr. Lambrecht is a 20+ year public company executive with broad experience in strategic acquisitions, corporate turnarounds, new business development, pioneering consumer products, corporate licensing, and interactive technology services. In addition, Mr. Lambrecht has held public company executive roles with responsibilities including day-to-day business operations, management, raising capital, board of directors' communication and investor relations. Mr. Lambrecht holds a certificate as a Certified Director from the UCLA Anderson Graduate School of Management Accredited Directors program.

Mr. Lambrecht, as an independent director, serves as one of six independent directors on the nominating committee along with Messrs. Cochennet, Williams, Ms. Thornton and Ms. Tucker. Mr. Lambrecht is also Chairman of our Compensation Committee.

Mr. Lambrecht is a director of ORHub, a SaaS company as well as a strategic consultant for American Rebel Holdings, Inc. He served as Director of Sales for Leveraged Marketing Associates, the worldwide leader in licensed brand extension strategies. While Executive Vice President for Smith & Wesson Holding Corporation, he was responsible for Smith & Wesson Licensing, Advanced Technologies and Interactive Marketing divisions. Previously, Mr. Lambrecht served as an independent director of Guardian 8 Holdings. He was the former President of A For Effort, an interactive database marketing company specializing in online content (advergaming) for clients such as the National Hockey League. Mr. Lambrecht's prior experience also includes Pre-IPO founder for Premium Cigars International and VP Sales/Marketing for ProductExpress.com.

Sarah Tucker, Director, age 77

Sarah Tucker was appointed to the Board of Directors in October 2019, and was elected at the 2020 Annual Meeting to serve a one-year term as an Independent Director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market. Ms. Tucker was reelected at the 2021 Annual Meeting to serve a one-year term. Ms. Tucker, as an independent director, serves on the nominating committee along with Messrs. Cochennet, Lambrecht, Williams, Addison and Ms. Thornton.

Sarah Tucker is a veteran executive for the business strategy/development, risk management, planning, engineering, procurement and construction of oil and gas projects globally. She has led projects with budgets from $5 million to over $3 billion in refining, petrochemicals, power, and offshore (both shallow and deep-water) for oil and liquified natural gas in Angola, Brazil, China, India, Italy, Korea, Mexico, Nigeria, Oman, Qatar, Spain, the United Kingdom and the United States.

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She has served as an operations executive and managing director for major engineering, construction and petrochemical technology companies including Kellogg, KBR, Kellogg-Mitsubishi Development Company, Raytheon Engineers and Constructors, Kvaerner Engineering and Construction of Norway and Silvertech of United Kingdom, a Process Control and High Integrity Safety System Solutions.

Sarah headed the Pollution Prevention Task Force Committee with eight Oil Companies' representatives participating and contributing to the Study for "Refinery Crude Unit Pollution Prevention Project" which is now an American Petroleum Institute DC Publication number 31101.

Over the past several years, she has worked closely with Mexican national oil company PEMEX to establish the country’s first deep water project valued at $14 billion.

According to her personal and professional philosophy, Sarah believes in developing strong relationships and respecting diverse cultures. As part of her philosophy, she led in 1992 a program to author a 51-page report which became the American Petroleum Institute publication, Environmental Design Considerations for Petroleum Refining Crude Processing Units.

Her parallel and subsequent effort with the World Bank was successful in striking a balance between the interests of indigenous people and major oil companies allowing projects to proceed in Africa. The publication became an influential guide for doing business in the developing world.

Paul T. Addison, Director, age 75

Paul T. Addison was appointed to the Board of Directors in June 2021, as an Independent Director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market. Mr. Addison was reelected at the 2021 Annual Meeting to serve a one-year term. Mr. Addison, as an independent director, serves as chairman of the Audit Committee and serves on the nominating committee along with Messrs. Cochennet, Lambrecht, Williams, Ms. Thornton and Ms. Tucker.

Paul T. Addison earned a B. A. in political science and economics from Howard University in 1969 and a M.B.A. from Harvard University in 1972.

He began his career as a loan specialist for The Economic Development Administration of the US Department of Commerce in 1972 providing loan assistance for companies that agreed to expand operations in areas of high unemployment before moving to New York in 1974 to join a Chase Manhattan subsidiary as Vice President and Treasurer that provided financing and startup capital for minority small business enterprises (a MESBIC). In 1978, he joined Citibank/Citicorp as a banker in the firm’s energy and utilities department rising to the level of a senior credit officer and Managing Director.

In this capacity, he managed the bank’s significant exposure to a large segment of the gas and electric utility industry. He also provided financial advice to the firm’s clients and on numerous occasions provided testimony before state and federal regulatory commissions. He also developed financing structures which allowed a number of utilities to rate base large nuclear projects without which a number of utilities would have suffered significant losses. This was a particular issue during the last significant construction cycle for the industry.

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He also approved and structured a number of large energy project financings for the firm.

Mr. Addison continued his work in the utility industry when he joined Solomon Smith Barney (Citigroup) in 1997 as a Managing Director in the electric and gas utility space until his retirement from the firm in 2002.

Upon retirement from Citigroup, Mr. Addison became an independent director of First Energy Corporation of Akron, Ohio, serving until his mandatory retirement in 2019. In his capacity as independent director, he served as Chair of the Finance Committee, and member of the Audit Committee as a designated financial expert. He was heavily involved in numerous financings over his term on the board and significantly participated in the company’s $4.7 billion acquisition of Allegheny Energy in 2010.

Mr. Addison is also a Trustee of the Maimonides Medical Center in Brooklyn New York, where he resides. Maimonides is the largest nonprofit hospital in Brooklyn with revenues approaching $1.5 billion and serves an extremely diverse population where over 60 languages are spoken. In his capacity as Trustee, Mr. Addison serves as Chair of the Budget and Finance Committee, member of the Legal and Audit Committee, member of the Quality and Safety Committee, and member of the Executive Committee. Mr. Addison also has served as the hospital’s representative on their self-insurance malpractice company, Hospital Insurance Company (HIC). Mr. Addison also served as Chair of the Audit Committee of HIC’s parent, the Federation of Jewish Philanthropies (FOJP), until its dissolution in 2019.

Jerry Sue Thornton, Director, age 74

Dr. Thornton was appointed to the Board of Directors in July 2021, as an Independent Director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market and was reelected at the 2021 Annual Meeting to serve a one-year term. Dr. Thornton, as an independent director, serves on the nominating committee along with Messrs. Cochennet, Lambrecht, Williams, Addison, and Ms. Tucker.

Dr. Jerry Sue Thornton earned her B.A. and M. A. in Communications from Murray State University (Kentucky) and Ph.D. in Higher Education Leadership/Administration from The University of Texas (Austin). She earned a post-doctorate certificate from Harvard University.

Dr. Thornton is President of DreamCatcher Education Consulting providing professional development, coaching and mentoring for newly appointed presidents of colleges. She is President Emeritus of the Cuyahoga Community College District serving from 1992 to 2013 which is headquartered in Cleveland, Ohio. The College serves over 30,000 students on four campuses with a budget over $300 million. She brings over 45 years of experience in leading and managing higher education institutions in Chicago, Minnesota and Ohio with a focus on workforce training and professional education.

She also has extensive corporate board service beginning in 1992 with National City Bank/Corporation, Office Max, American Greetings and Bridgestreet Worldwide, Inc. until those companies had a change of control. She later served on the Boards of American Family Insurance, Applied Industrial Technologies, Inc., Republic Powdered Metals, (RPM, Inc.) and First Energy. She is currently serving on the Boards of Barnes and Noble Education (BNED) and Parkwood LLC (an Ohio financial planning company).

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Gaining extensive business experience through her board director services of public and private companies, she has been a member of compensation, nominating and governance and audit committees. From manufacturing through distribution; industrial through commercial; financial through merchandizing and energy, Dr. Thornton has amassed over 29 years of business experience. During that tenure, she has served on Special Committees of the Board of Directors involved in acquisition.

Dr. Thornton brings to the Board of Directors broad leadership and business skills as well as an extensive background in workforce/talent acquisition, development and evaluation/assessment.

La Forrest V. Williams, Director, age 71

Mr. Williams was appointed to the Board of Directors in July 2021, as an Independent Director within the meaning of Rule 5605(a)(2) of The Nasdaq Stock Market and was reelected at the 2021 Annual Meeting to serve a one-year term. Mr. Williams, as an independent director, serves on the nominating committee along with Messrs. Cochennet, Lambrecht, Addison, Ms. Thornton and Ms. Tucker.

Mr. Williams is a veteran executive of the communications, computer and information assurance business of the Department of Defense and Intelligence community. He served in the civilian Defense Intelligence Senior Executive Service and the United States Air Force senior officer corps as a communication/computer intelligence and information assurance strategist for more than 40 years. His activity in information assurance became a nexus with the vulnerabilities of the energy grid.

His accomplishments include serving as a leader in the original merging of communications and computer systems technology into one management structure for the United States Air Force. His energy focus evolved through his engagement in studying cybersecurity threats to our energy grid during his career at the National Security Agency. Mr. Williams has a history of leadership positions which includes, Chief Information Officer (CIO) of the National Security Agency (NSA), Director of Information Assurance for the U.S. European Command and Director of Legislative Affairs for the National Security Agency. Mr. Williams' experience includes leading a military Communications Group of more than 500 technicians and staff, supporting Nellis Air Force Base Nevada networks. He has installed, managed, upgraded and secured communication cable and space networks worldwide; to include the United States, Europe and South Pacific.

Mr. Williams holds a B.S. degree in Business Administration from San Jose State University and an M.S. Degree in Technology of Management Information Systems from the American University, Washington D.C. He has served at the forefront in the Information Age and was an early leader at NSA in advocating concern about the vulnerability of our nation's energy grid. His advocacy led to the formation of customer assistance teams that he established to advise on the survivability of energy systems of national security concern. He later joined the National War College faculty in 2010 to teach National Security Strategy as a visiting Professor until 2013.

He is a proven results-oriented leader with broad experience as an Air Force Colonel and three years of Board of Director experience with The Government Employees Benefit Association for federal employees. In his spare time, he is a volunteer Docent at the Smithsonian Institute in Washington D.C. and gives tours through the National Museum of American History.

All eight directors are nominated for election to a one-year term on the Board of Directors.

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Vote Required

If a quorum is present, approval of this proposal requires the affirmative vote of a majority of the outstanding shares of the Company’s common stock entitled to vote on this proposal at the Annual Meeting. Because matters considered “routine” by the applicable regulations, such as ratification of auditors, are under consideration at the Annual Meeting, abstentions and broker non-votes will be counted towards a quorum, but these abstentions, broker non-votes, and any other outstanding shares that are not voted will have the effect of a vote “AGAINST” the proposal.

The Board of Directors recommends that Stockholders vote “FOR” election of the nominees for director named above.

PROPOSAL II

Ratification of the Appointment of Grant Thornton LLP

as the Company’s Independent Registered Public Accounting Firm

for the Year Ending December 31, 2022

The Audit Committee has selected Grant Thornton LLP to serve as independent registered public accounting firm for the fiscal year ending December 31, 2022. The board is submitting the appointment of the independent registered public accounting firm to the stockholders for ratification at the Annual Meeting.

Representatives of Grant Thornton LLP are expected to be available by teleconference at the Annual Meeting, will have the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions.

Shareholder ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm is not required by the Company’s Restated Articles of Incorporation, bylaws or otherwise; however, the board of directors is submitting the selection of Grant Thornton LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will review its future selection of an independent registered public accounting firm considering that vote result. Your ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022, does not preclude us from terminating our engagement of Grant Thornton LLP and retaining a new independent registered public accounting firm, if we determine that such an action would be in the best interests of the Company and its stockholders.

Vote Required

The Board of Directors recommends a vote “FOR” the ratification of the appointment of Grant Thornton LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2022.

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PROPOSAL III

Advisory Approval of the Company’s Executive Compensation

(Say-on-Pay)

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and related SEC regulations require that, at least once every three years, we provide our stockholders with the opportunity to express their views on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement. We held this vote, which is often referred to as the Say-on-Pay vote, at our annual meeting of stockholders held in 2019. At the meeting, our stockholders voted to hold the frequency of our Say-on-Pay vote on an annual basis. Our board of directors agreed to support the stockholder decision; therefore, the Company will hold future non-binding advisory votes on the compensation of our named executive officers every year, at least until the next required vote of frequency of stockholder votes on the compensation of our named executive officers. Such Say-on-Frequency vote must occur no later than the annual or other meetings of stockholders held in the sixth calendar year after the immediately preceding Say-on-Frequency vote which was the 2019 Annual Meeting of Stockholders. The Company could hold a Say-on-Frequency vote more frequently than every six years if it elects to do so.

The compensation of our named executive officers for the past three fiscal years is set forth in the Elements of Executive Compensation Section. The Compensation Discussion and Analysis, or CD&A Section, describes our executive compensation policies and practices and analyzes the compensation received by our named executive officers in fiscal year 2021. As described in the CD&A, our executive compensation philosophy is to reward performance and motivate collective achievement of strategic objectives that will contribute to our company’s success. Our board of directors believes the compensation programs for our named executive officers effectively meet the primary objectives of attracting and retaining highly qualified executives, motivating our executives to achieve our business objectives, rewarding our executives appropriately for their individual and collective contributions and aligning our executives’ interests with the long-term interests of our stockholders, and our board believes our programs are reasonable when compared to compensation at similar companies.

The vote on this resolution is not intended to address any specific element of executive compensation. Instead, the vote relates to the executive compensation of our named executive officers, as set forth in this proxy statement pursuant to the rules of the SEC. This vote provides stockholders with the opportunity to endorse or not endorse the compensation of our named executive officers, but is advisory and not binding on our company or our board of directors.

This vote will not be binding on the board of directors or the Compensation Committee and may not be construed as overruling a decision by the board or the Compensation Committee or create or imply any additional fiduciary duty on the board. It will also not affect any compensation paid or awarded to any executive. The approval or disapproval of this proposal by stockholders will not require the board of directors or the Compensation Committee to take any action regarding the Company’s executive compensation practices. The final decision on the compensation and benefits of the Company’s executive officers and on whether, and if so, how to address shareholder disapproval remains with the board and the Compensation Committee. Although the Say-on-Pay resolution is non-binding, the board of directors will review and consider the voting results when making future executive compensation decisions.

The board of directors welcomes and invites stockholder opinions, comments and recommendations relating to executive compensation and will consider all stockholder comments when making executive compensation awards. Stockholders may communicate with the board of directors by writing to the Company at Orbital Energy Group, 1924 Aldine Western, Houston, Texas 77038 or phone (832) 467‑1420. Stockholders who would like their submission directed to a member of the board may so specify and the communication will be forwarded as appropriate.

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Vote Required

The Board of Directors recommends a vote “FOR” Advisory Approval of the Company’s Executive Compensation (Say-on-Pay) as disclosed in the compensation tables in the Proxy Statement.

PROPOSAL IV

To Approve an Amendment to Paragraph 11.27 of the

Orbital Energy Group 2020 Incentive Award Plan

by Increasing the Overall Share Limit by 5,000,000 Shares

In this Proposal, Orbital Energy Group is requesting its stockholders to approve an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan (the “Plan”) by increasing the Overall Share Limit from 5,000,000 to 10,000,000 shares. The Overall Share Limit is the total number of shares reserved and available for grant and issuance pursuant to the Plan, as adopted by the Stockholders. Currently, the Overall Share Limit is five million (5,000,000) shares of which equity awards for 1,547,941 shares have been granted. By the terms of the Plan, the Company shall reserve and keep available a sufficient number of shares as shall be required to satisfy the requirements of all outstanding awards granted under the Plan. This increase will become effective upon stockholder approval.

A Brief Description of the Plan

The purpose of the Plan is to enhance our ability to attract, retain and motivate persons who make (or are expected to make) important contributions to Orbital Energy Group by providing these individuals with equity ownership opportunities. We believe that the Plan is essential to the Company’s success. Equity awards are intended to motivate high levels of performance and align the interests of our directors, employees and consultants with those of our stockholders by giving directors, employees and consultants the perspective of an owner with an equity stake in the Company and providing a means of recognizing their contributions to the success of Orbital Energy Group. Our board of directors and management believe that equity awards are necessary to remain competitive in its industry and are essential to recruiting and retaining the highly qualified employees who help Orbital Energy Group meet its goals.

The Plan Share Limit

In determining whether to approve the amendment to paragraph 11.27 of the Plan by increasing the Overall Share Limit by 5,000,000 shares, our board of directors considered, among other factors, the following:

•

Both of our prior equity incentive plans have expired.

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•

Share Limit means the total number of shares reserved and available for grant and issuance pursuant to this Plan. As of the date of the proxy statement, the Share Limit is five million (5,000,000) shares of which equity awards for 1,547,941 shares have been granted. By the terms of the Plan, the Company shall reserve and keep available a sufficient number of shares as shall be required to satisfy the requirements of all outstanding Awards granted under this Plan.

•

Share Limit may not be increased without stockholder approval.

•

A primary purpose of the Share Reserve under the Plan is to provide Orbital Energy Group with appropriate capacity to issue equity compensation in anticipation of future acquisitions. In determining the size of the Share Reserve under the Plan, our board of directors will consider the substantial changes to the capitalization structure of the Company that has occurred as a result of completed acquisitions as well as future anticipated acquisitions.

•

Orbital Energy Group expects the proposed aggregate Share Reserve under the Plan to provide enough shares for awards for at least the next year, assuming we continue to grant awards consistent with our current practices, and further dependent on the price of our shares and hiring activity during the next few years, forfeitures of outstanding awards, and future circumstances, which may require Orbital Energy Group to change its current equity grant practices. Orbital Energy Group cannot predict its future equity grant practices, the future price of our shares or future hiring activity with any degree of certainty at this time, and the share reserve under the Plan could last for a shorter or longer time.

In light of the factors described above, and the fact that the ability to continue to grant equity compensation is vital to Orbital Energy Group’s ability to continue to attract and retain employees in the extremely competitive labor markets in which it competes, our board of directors believes it has approved a recommendation for the stockholders to approve an amendment to paragraph 11.27 of the Plan by increasing the Overall Share Limit by 5,000,000 shares that is reasonable and appropriate at this time. The Orbital Energy Group board of directors does not intend to create a subcommittee to evaluate the risk and benefits for issuing shares under the Plan.

A copy of paragraph 11.27 of the Plan is attached to this proxy statement as Annex A.

Vote Required

The Board of Directors recommends a vote “FOR” approval of an amendment to paragraph 11.27 of the Orbital Energy Group 2020 Incentive Award Plan by increasing the Overall Share Limit by 5,000,000 shares.

Summary of the Orbital Energy Group 2020 Incentive Award Plan

This section summarizes certain principal features of the Orbital Energy Group 2020 Incentive Award Plan (the “Plan”).

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Eligibility and Administration

Orbital Energy Group’s employees, consultants and directors, and employees and consultants of Orbital Energy Group’s subsidiaries, will be eligible to receive awards under the Plan.

The Plan is administered by the Orbital Energy Group board of directors, which may delegate its duties and responsibilities to one or more committees of Orbital Energy Group’s directors and/or officers referred to collectively as the plan administrator, subject to limitations imposed under the Plan, Section 16 of the Exchange Act, stock exchange rules and other applicable laws. The plan administrator has the authority to take all actions and make all determinations under the Plan, to interpret the Plan and Award Agreement and to adopt, amend and repeal rules for the administration of the Plan as it deems advisable. The plan administrator will also have the authority to determine which eligible service providers receive awards, grant awards and set the terms and conditions of all awards under the Plan, including vesting provisions, subject to the conditions and limitations in the Plan.

Lapsed or Terminated Shares

If all or any part of an Award expires, lapses or is terminated, exchanged for cash, surrendered, repurchased, canceled without having been fully exercised or forfeited, in any case, in a manner that results in the Company acquiring Shares covered by the Award at a price not greater than the price (as adjusted to reflect any Equity Restructuring) paid by the Participant for such Shares or not issuing any Shares covered by the Award, the unused Shares covered by the Award will not become or again be available for Award grants under the Plan.

Awards

The Plan provides for the grant of stock options, including ISOs and nonqualified stock options (“NSOs”), stock appreciation rights (“SARs”), restricted stock, dividend equivalents, restricted stock units (“RSUs”) and other stock or cash-based awards. Certain awards under the Plan may constitute or provide for payment of “nonqualified deferred compensation” under Section 409A of the Code. All awards under the Plan will be set forth in the award agreement, which will detail the terms and conditions of awards, including any applicable vesting and payment terms and post termination exercise limitations. All Awards shall be subject to a minimum vesting of one year from the Grant Date.

Certain Transactions

In connection with certain corporate transactions and events affecting the common stock of Orbital Energy Group, including a change in control, or change in any applicable laws or accounting principles, the plan administrator has broad discretion to take action under the Plan to prevent the dilution or enlargement of intended benefits, facilitate the transaction or event or give effect to the change in applicable laws or accounting principles. This includes providing for the assumption or substitution of awards by a successor entity, adjusting the number and type of shares subject to outstanding awards and/or with respect to which awards may be granted under the Plan.

Provisions of the Plan Relating to Director Compensation

The Plan provides that the plan administrator may establish compensation for non-employee directors from time to time subject to the Plan’s limitations. The plan administrator will from time to time determine the terms, conditions and amounts of all non-employee director compensation in its discretion and pursuant to the exercise of its business judgment, taking into account such factors, circumstances and considerations as it shall deem relevant from time to time, provided that, the sum of any cash compensation or other compensation and the grant date fair value of any equity awards granted under the Plan as compensation for services as a non-employee director during any fiscal year may not exceed $250,000 per year of a non-employee director’s service as a non-employee director. The non-employee Director receiving such additional compensation may not participate in the decision to award such compensation or in other contemporaneous compensation decisions involving the non-employee Director.

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Plan Amendment and Termination

The Orbital Energy Group board of directors may amend or terminate the Plan at any time; however, an amendment that increases the number of shares available under the Plan requires stockholder approval. The Plan will remain in effect until the fifth anniversary of the date the Orbital Energy Group board of directors adopted the Plan, unless earlier terminated by the board of directors.

Foreign Participants and Transferability

The plan administrator may modify awards granted to participants who are foreign nationals or employed outside the United States or establish subplans or procedures to address differences in laws, rules, regulations or customs of such foreign jurisdictions. Except as the plan administrator may determine or provide in an award agreement, awards under the Plan are generally non-transferrable, except by will or the laws of descent and distribution or, subject to the plan administrator’s consent, pursuant to a domestic relations order, and are generally exercisable only by the participant. With regard to tax withholding obligations arising in connection with awards under the Plan, and exercise price obligations arising in connection with the exercise of stock options under the Plan, the plan administrator may, in its discretion, accept cash, wire transfer or check, shares of common stock of Orbital Energy Group that meet specified conditions, a promissory note, a “market sell order,” such other consideration as the plan administrator deems suitable or any combination of the foregoing.

Internal Revenue Code

Income Tax Effects for the Company. The Company generally will be entitled to a tax deduction in connection with an award under the 2020 Incentive Plan in an amount equal to the ordinary income realized by a participant at the time the participant recognizes such income (for example, upon the exercise of an NSO). As described herein, Code Section 162(m) may limit the deductibility of awards granted under the 2020 Incentive Plan.

Internal Revenue Code Section 162(m) Considerations. Code Section 162(m) generally disallows a tax deduction to public companies for compensation in excess of $1,000,000 paid to a company's principal executive officer and each of the other three most highly compensated officers (other than the principal financial officer) ("Covered Employees") in any one fiscal year. Stock options and stock appreciation rights are exempt from this limitation if (a) the exercise price is at least 100% of the fair market value of the underlying stock on the date the option or stock appreciate right is granted and (b) the plan under which the options are granted is approved by the shareholders and contains a limit on the number of options or stock appreciation rights granted to any' one individual under the plan during a specific period. Various other rules apply with regard to compensation committee independence and the procedures that must be followed by the committee in connection with performance-based awards that may be fully deducted under Code Section 162(m). Among other requirements, stock awards such as restricted stock and stock units, and performance cash awards such that vest contingent upon the achievement of performance goals, the material terms of which have been approved by the shareholders, in order to be exempt from this limitation. The 2020 Incentive Plan includes certain fiscal year limits, as described above, on the number of shares or total dollars that may be granted to an individual under options, stock appreciation rights, restricted stock, stock units and performance-based cash awards in order to comply with the Code Section 162(m) requirements. The above description is subject to proposed changes in Section 162(m) that would eliminate the exception from the general rule for performance-based compensation. If that proposed statutory' change is enacted, we would not expect to be able to deduct compensation in excess of $1 million paid during a single year to a Covered Employee.

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Internal Revenue Code Section 409A. Code Section 409A governs that the federal income taxation of certain types of nonqualified deferred compensation arrangements. A violation of Code Section 409A generally results in an acceleration of the recognition of income of amounts intended to be deferred and the imposition of a federal excise tax of 20% on the employee over and above the income tax owned plus possible penalties and interest. The types of arrangements covered by Code Section 409A are broad and may apply to certain awards available under the 2020 Incentive Plan (such as stock units). The intent is for the 2020 Incentive Plan, including any awards available thereunder, to comply with the requirements of Code 409A to the extent applicable. As required by Code Section 409A, certain nonqualified deferred compensation payments to specific employees may be delayed to the seventh month after such employee's separation from service.

Securities Laws

The Plan is intended to conform to all provisions of the Securities Act of 1933, as amended, and the Exchange Act, and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. The Plan will be administered, and options will be granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations.

PROPOSAL V

To Approve the Conversion of the Company's Domicile State

from Colorado to Texas, Which Conversion Shall Include

Changing the Corporate Name

from Orbital Energy Group, Inc. to Orbital Infrastructure Group, Inc.

For the reasons discussed below, the Board has unanimously approved and declared it is advisable and in the best interests of Orbital Energy Group, Inc. and its shareholders to convert the domicile state of Orbital Energy Group, Inc. from the State of Colorado to the State of Texas (the “Conversion”), which includes adopting a new Texas Certificate of Formation (the “Texas Certificate”) and bylaws (the “Texas Bylaws”).

Summary

The principal effects of the Conversion will be that:

●

The corporate name will change from Orbital Energy Group, Inc. (the "Colorado Entity") to Orbital Infrastructure Group, Inc. (the "Texas Entity") AND the par value of our common stock will change from $0.001 to $0.0001.

●

The affairs of the Colorado Entity will cease to be governed by the Colorado Corporations and Associations Act (the “CCAA”) and its existing articles of incorporation and bylaws (the “Colorado Articles” and the “Colorado Bylaws," respectively) and will become subject to the Texas Business Organizations Code (the “TBOC”).

●

The Texas Entity (the resulting Texas corporation) will be the same entity as the Colorado Entity (currently incorporated in Colorado), will possess all of the properties, rights and privileges of the Colorado Entity, will continue with all of the debts, liabilities and obligations of the Colorado Entity and will continue with the same officers and directors of the Colorado Entity immediately prior to the Conversion, as more fully described below.

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●

When the Conversion becomes effective, all of the issued and outstanding shares of common stock of the Colorado Entity will be automatically converted into issued and outstanding shares of common stock of the Texas Entity, without any further action on the part of our shareholders. The Conversion will have no effect on the trading of our stock on the Nasdaq Capital Market tier of The Nasdaq Stock Market under the new symbol “OIG.” The Texas Entity will continue to file periodic reports and other documents as and to the extent required by the rules and regulations of the Securities and Exchange Commission (the “SEC”). Shares of our common stock that are freely tradeable prior to the Conversion will continue to be freely tradeable as shares of the Texas Entity common stock, and shares of our common stock that are subject to restrictions prior to the Conversion will continue to be subject to the same restrictions as shares of the Texas Entity common stock. The Conversion will not change the respective status of the Colorado Entity or our shareholders under federal securities laws.

●

Upon effectiveness of the Conversion, all of our employee benefit and incentive plans will become plans of the Texas Entity, and each option, restricted stock unit, equity award or other right issued under such plans will automatically be converted into an option, restricted stock unit, equity award or right to purchase or receive the same number of shares of the Texas Entity common stock, at the same price per share, upon the same terms and subject to the same conditions as before the Conversion. In addition, our employment contracts and other employee benefit arrangements also will be continued by the Texas Entity upon the same terms and subject to the same conditions in effect at the time of the Conversion.

Reasons for the Conversion

The primary reason for the Conversion is that the corporate executive offices and core of operations are located in Houston, Texas[, the Colorado Entity has no present nexus within the State of Colorado] and the corporate laws of the State of Texas are more developed. As a result of the corporate tax structure and reasonable annual franchise fee (or “margin” tax) of Texas, many major corporations have incorporated in Texas or have changed their corporate domiciles to Texas in a manner similar to the Conversion. The Texas judiciary has become particularly familiar with corporate law matters and a substantial body of court decisions has developed construing the corporate laws of Texas, thus providing clarity and predictability with respect to corporate legal and governance affairs. The Board believes any benefits provided to the Texas Entity by Texas law directly benefit our shareholders.

The Board is not proposing the Conversion to prevent a change in control of the Colorado Entity and is not aware of any present attempt by any person to acquire control of the Colorado Entity or to obtain representation on the Board.

Plan of Conversion and Adoption of Texas Certificate of Formation and Bylaws

To accomplish the Conversion, the Board has adopted a plan of conversion substantially in the form appended to this proxy statement as Annex B (the “Plan of Conversion”). The Plan of Conversion provides that we will convert into a Texas corporation and will thereafter be subject to all of the provisions of the TBOC, the Texas Certificate and the Texas Bylaws.

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Assuming that our shareholders approve this proposal, we will cause the Conversion to be effected as soon as practicable thereafter by filing with the Secretary of State of the State of Colorado a Statement of Conversion substantially in the form appended to this proxy statement as Annex C (the “Colorado Statement of Conversion”) and will file with the Secretary of State of the State of Texas (i) a Certificate of Conversion substantially in the form appended to this proxy statement as Annex D (the “Texas Certificate of Conversion”); and (ii) the Texas Certificate, which will govern the Texas Entity as a Texas corporation, substantially in the form appended to this proxy statement as Annex E. In addition, assuming that our shareholders approve this proposal, the Board has adopted the Texas Bylaws, substantially in the form appended to this proxy statement as Annex F, and we will enter into a new indemnification agreement with each director and executive officer of the Texas Entity based upon provisions of the TBOC, substantially in the form appended to this proxy statement as Annex G (the “Texas Indemnification Agreement”). Approval of this proposal by our shareholders will constitute approval of the Plan of Conversion, the Colorado Statement of Conversion, the Texas Certificate of Conversion, the Texas Certificate, the Texas Bylaws and the Texas Indemnification Agreement. Shareholders should also note that approval of the Conversion will also constitute approval of the Colorado Entity’s equity and other employee benefit and incentive plans continuing as plans of the Texas Entity.

Notwithstanding the foregoing, the Conversion may be delayed by the Board or the Plan of Conversion may be terminated and abandoned by action of the Board at any time prior to the effective time of the Conversion, whether before or after approval by our shareholders, if the Board determines for any reason that such delay or termination would be in the best interests of the Colorado Entity and our shareholders. If the Conversion is approved by our shareholders, the Conversion would become effective upon the filing (and acceptance thereof by the Secretary of State of Colorado and the Secretary of State of Texas, as applicable) of the Colorado Statement of Conversion, the Texas Certificate of Conversion and the Texas Certificate.

No Change in Business, Management or Members of the Board of Directors

The Conversion will not (i) result in any change in the Colorado Entity’s business, management, employees, fiscal year, assets, liabilities or federal tax identification number; (ii) cause the principal executive offices or other facilities of the Colorado Entity to be moved; or (iii) result in any relocation of management or other employees. The mailing address of the principal offices and the telephone number of the Texas Entity will be the same as the Colorado Entity’s current address and telephone number.

The individuals serving as directors of the Colorado Entity as of immediately prior to the Conversion will continue to be the directors of the Texas Entity immediately following the Conversion, and will continue to serve for their respective terms. The individuals serving as executive officers of the Colorado Entity as of immediately prior to the Conversion will continue to serve as executive officers of the Texas Entity as of immediately following the Conversion, without a change in their title or responsibilities. In addition, the Conversion will not affect any of the Colorado Entity’s contracts with third parties. However, the Texas Entity will be deemed to be the Colorado Entity’s successor with respect to the Colorado Entity’s current contracts and agreements and will succeed to all of the Colorado Entity’s rights and obligations under these contracts and agreements.

Immediately following the Conversion, the Texas Entity Common Stock will continue to be traded on the Nasdaq Capital Market, but under the new stock symbol, “OIG.”

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Federal Income Tax Consequences of the Conversion

The discussion of U.S. federal income tax consequences set forth below is for general information only and does not purport to be a complete discussion or analysis of all potential tax consequences that may apply to a shareholder. The discussion does not deal with all of the tax considerations that may be relevant to particular shareholders, such as shareholders who are dealers in securities, foreign persons, tax exempt entities or shareholders who received their stock in the Colorado Entity in connection with stock option or stock purchase plans or in other compensatory transactions. In addition, this discussion does not address any state, local or foreign tax considerations nor does it address any federal estate, gift, employment, excise or other non-income tax considerations. This discussion also does not address the tax consequences of transactions effected prior to or after the Conversion (whether or not such transactions are in connection with the Conversion) including, without limitation, the exercise of options, warrants or similar rights to purchase the Colorado Entity’s stock. The following discussion is based upon provisions of the Internal Revenue Code (the “Code”), regulations, administrative rulings and judicial decisions presently in effect, all of which are subject to change (possibly with retroactive effect) or to different interpretations. Shareholders are urged to consult their tax advisors to determine the particular tax consequences of the Conversion, including the applicability and effect of federal, state, local, foreign and other tax laws.

The Conversion provided for in the Plan of Conversion is intended to be a tax-free reorganization under Section 368(a) of the Code. Assuming the Conversion qualifies as a tax-free reorganization, no gain or loss should be recognized to the holders of our capital stock as a result of consummation of the Conversion. Shareholders should have the same basis in the Texas Entity common stock received pursuant to the Conversion as they had in the shares of the Colorado Entity common stock held immediately prior to the time the Conversion is consummated. The holding period with respect to the Texas Entity common stock should include the period during which corresponding shares of the Colorado Entity common stock were held, provided the latter was held as a capital asset at the time of consummation of the Conversion.

Accounting Treatment

We expect that the Conversion will have no effect from an accounting perspective because there is no change in the entity as a result of the Conversion. As such, the financial statements of the Colorado Entity previously filed with the SEC will remain the financial statements of the Texas Entity following the Conversion.

Dissenters’ Rights

Under the Colorado Business Corporation Act, as amended (the “CBCA”) and the Colorado Corporations and Associations Act, as amended (the "CCAA"), shareholders are not entitled to dissenters’ rights in connection with a Conversion if the shares held by the shareholder are listed on a national securities exchange registered under the federal Securities Exchange Act of 1934, as amended, (the "Act") or if the common stock of the company are held of record by more than two thousand shareholders. Because the Colorado Entity’s common stock is currently listed on the Nasdaq Global Market, shareholders will therefore not be entitled to dissenters’ rights in connection with the Conversion.

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Comparison of Shareholder Rights Before and After the Conversion

Although the Texas Certificate and the Texas Bylaws are substantially similar to provisions from the current Colorado Articles and the Colorado Bylaws, they also include certain provisions that are different from the provisions contained in the Colorado Articles and the Colorado Bylaws. The following discussion briefly summarizes some of the changes resulting from the Conversion and the significant differences between the CBCA, CCAA and the Colorado Articles and the Colorado Bylaws and the TBOC, the Texas Certificate and the Texas Bylaws.

Authorized Capital Stock
Colorado	Texas
The Colorado Articles authorize 335,000,000 shares of capital stock, par value $0.001 per share, comprised of 325,000,000 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share. As of immediately prior to the Conversion, approximately 95,948,031 shares of the Colorado Entity Common Stock and no shares of preferred stock of the Colorado Entity will be outstanding.	Other than changing the par value from $0.001 to $0.0001 and the corporate name from the Colorado Entity to the Texas Entity, there are no changes. The number of outstanding shares will not change.

Blank Check Preferred
Colorado	Texas
Under the CCAA, if the articles of incorporation so provide, a corporation may issue one or more classes of stock or one or more series of stock within any class, with such preferences, limitations and relative rights as determined by the board of directors without shareholder approval (“Blank Check Preferred Stock”). The Colorado Articles authorize 10,000,000 shares of preferred stock. As of immediately prior to the conversion, the authorized preferred stock will constitute undesignated Blank Check Preferred Stock.	The Texas Entity will authorize 10,000,000 shares of undesignated Blank Check Preferred Stock. The TBOC provides authority similar to the CCAA.

Business Combinations Statute
Colorado	Texas
The board of directors must recommend the plan of conversion, plan of merger, or plan of exchange to the shareholders unless the board of directors determines that, because of conflict of interest or other special circumstances, it should make no recommendation and communicates the basis for its determination to the shareholders with the plan and the shareholders entitled to vote on the plan of conversion, plan of merger, or plan of exchange must approve the plan. CCAA 7-111-103	Under Texas law, any merger with a third party requires approval by 2/3 of the outstanding shares of the Texas corporation unless a different threshold, not less than a majority, is specified in the certificate of formation. TBOC Section 21.954(a) The proposed Texas Certificate modifies the statutory vote requirement and requires the approval of such transactions by affirmative vote of the holders of only a majority of the outstanding shares entitled to vote thereon, unless any class or series of shares is entitled to vote as a class thereon, in which event the vote required shall be the affirmative vote of the holders of a majority of the outstanding shares within each class or series of shares entitled to vote thereon as a class and at least a majority of the outstanding shares otherwise entitled to vote thereon.

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Sales, Leases, Exchanges or Other Dispositions
Colorado	Texas
A corporation may, as authorized by its bylaws or by the board of directors sell, lease, exchange, or otherwise dispose of any or all of its property whether or not in the usual and regular course of business with approval by the shareholders of the transaction. CCAA 7-112-101.	Generally, the sale, lease, exchange or other disposition of all, or substantially all, of the property and assets of a Texas corporation requires the approval of the holders of at least 2/3 of the outstanding shares of the corporation entitled to vote. No such approval is required, however, if the transaction is made in the usual and regular course of the corporation’s business. Under Texas law, the transfer of substantially all of a corporation’s assets in such a manner that the corporation continues directly or indirectly to engage in one or more businesses is deemed to be in the usual and regular course of its business. The proposed Texas Certificate overrides the default statutory vote requirement and requires the approval of such transactions by affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon.

Shareholder Consent to Action Without a Meeting
Colorado	Texas
The CCAA provides that, unless the articles of incorporation require such action be taken at a shareholder meeting or expressly authorize that such action can be taken by less than unanimous written consent, any action required or permitted to be taken at a shareholder meeting may be taken without a meeting if all of the shareholders entitled to vote consent to such action in writing. The CCAA provides that, unless the articles of incorporation require such action be taken at a shareholder meeting or expressly authorize that such action can be taken by less than unanimous written consent, any action required or permitted to be taken at a shareholder meeting may be taken without a meeting if all of the shareholders entitled to vote consent to such action in writing.	Under Texas law, the certificate of formation may authorize the owners or members of the entity to take action without holding a meeting, providing notice, or taking a vote if owners or members of the entity having at least the minimum number of votes that would be necessary to take the action that is the subject of the consent at a meeting, in which each owner or member entitled to vote on the action is present and votes, sign a written consent or consents stating the action taken. The proposed Texas Certificate allows action by one or more written consents if such consent or consents are signed by the holders having not less than the minimum number of votes that would be necessary to take such action, as described above. Such action must include the date each shareholder signed the consent and the date of signing of the latest dated consent satisfying the minimum number of shareholders necessary to approve the action that is the subject of the consent. The described must not be later than the 60^th day after the date of the signing of the earliest dated consent of the shareholders signing the consent. If a consent does not contain the date that a shareholder, the date that date that the shareholder signed the consent is considered to be the date that the consent is received by the filing entity. The entity shall promptly notify shareholder who did not sign a consent described above of the action that is the subject of the consent.

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Special Meetings of Shareholders
Colorado	Texas
Under the CCAA, a special meeting of shareholders shall be held if: (i) called by the board of directors or any person authorized by the bylaws or a resolution of the board of directors to call such a meeting; or (ii) if the corporation receives one or more written demands for a special meeting, stating the purpose or purposes for which it is to be held, signed and dated by the holders of shares representing at least 10% of all of the votes entitled to be cast on any issue proposed to be considered at the special meeting. The Colorado Bylaws provide that a special meeting of the Colorado Entity’s shareholders may be called by the Board, by the Colorado Entity’s Chief Executive Officer or at the request of the holders of not less than 10% of the shares of the Colorado Entity Common Stock entitled to vote at the special meeting.	Under Texas law, shareholders are guaranteed the right to call special meetings. Unless otherwise specified in the corporation’s certificate of formation, holders of not less than 10% of all of the shares entitled to vote at the proposed meeting have the right to call a special shareholders’ meeting. The certificate of formation may allow for special meetings to be called by a number of shares greater than or less than 10%, but it may not set the required number of shares above 50%. The president, board of directors, or any other person authorized to call special meetings by the certificate of formation or bylaws of the corporation may also call special shareholders’ meetings. The proposed Texas Certificate and the Texas Bylaws require 35% of all of the shares entitled to vote at the proposed meeting to call a special shareholders meeting.

Anti-Takeover Statutes
Colorado	Texas
The CCAA does not contain provisions designed to deter takeovers of public companies, such as a “fair price” statute, “business combination” statute, “control share acquisition” statute or “cash-out” statute. However, a company’s articles of incorporation may include such provisions. The Colorado Articles are silent on this issue	The TBOC is silent on this issue.^[1]

Procedure for Filling Vacant Directorships
Colorado	Texas
Unless otherwise provided in the articles of incorporation, if a vacancy occurs on a board of directors, including a vacancy resulting from an increase in the number of directors: (a) The shareholders may fill the vacancy; (b) The board of directors may fill the vacancy; or (c) If the directors remaining in office constitute fewer than a quorum of the board, they may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office. CCAA 7-108-110.	Under Texas law, any vacancy occurring in the board of directors may, unless otherwise authorized by a corporation’s certificate of formation, fill a vacancy or a newly created vacancy in a director position only: (i) by the affirmative vote of the majority of the directors then in office, even if less than a quorum, (ii) by the sole remaining director, or (iii) by the affirmative vote of the shareholders. A directorship to be filled because of an increase in the number of directors may be filled by the shareholders or by the board of directors for a term of office continuing only until the next election of one or more directors by the shareholders. The board of directors may not fill more than two such directorships during the period between any two successive annual meetings of shareholders. The proposed Texas Bylaws require the affirmative vote of the majority of directors then in office, even if less than a quorum, to fill any vacancy in the board of directors.

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Proxy
Colorado	Texas
A shareholder may vote the shareholder’s shares in person or by proxy by signing an appointment form, either personally or by the shareholder’s attorney-in-fact or by an electronic transmission to the person who will be the holder of the proxy. CCAA 7-107-203.	Under Texas law, a shareholder may authorize another person or persons to act for such shareholder by proxy. A proxy is only valid for 11 months from its date unless otherwise provided in the proxy.

Charter/Articles Amendments
Colorado	Texas
Under the CCAA, amendments to the articles of incorporation, other than ministerial amendments authorized by the board of directors without shareholder action, may be proposed by the board of directors or by the holders of shares representing at least 10% of all of the shares entitled to vote upon the amendment. The board of directors must recommend the amendment to the shareholders unless the amendment is proposed by the shareholders or the board of directors determines that because of a conflict of interest or other special circumstances it should make no recommendation and communicates the basis for its determination to the shareholders with the amendment. The Colorado Articles provide that the Colorado Entity reserves the right to amend or repeal any provision contained in the Colorado Articles in any manner permitted under the CCAA. Under the Colorado Articles all rights and powers conferred upon directors and shareholders are granted subject to the reservation.	Under Texas law, an amendment to the certificate of formation requires the approval of the holders of at least 2/3 of the outstanding shares of the corporation, unless a different threshold, not less than a majority, is specified in the Texas Certificate. The proposed Texas Certificate alters the default statutory approval requirements and requires an amendment to the certificate of formation to be approved by holders of a majority of the outstanding shares entitled to vote thereon, unless any class or series of shares is entitled to vote as a class thereon, in which event the vote required shall be the affirmative vote of the holders of a majority of the outstanding shares within each class or series of shares entitled to vote thereon as a class and at least a majority of the outstanding shares otherwise entitled to vote thereon.

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Bylaw Amendments
Colorado	Texas
Under the CCAA, shareholders may amend the corporation’s bylaws. Unless otherwise specified in the corporation’s articles of incorporation or bylaws, directors also are permitted to amend the bylaws, other than bylaws establishing greater quorums or voting requirements for shareholders or directors. Directors may not amend the bylaws to change the quorum or voting requirements for shareholders, and directors may amend the bylaws to change the quorum or voting requirements for directors only if such provision was originally adopted by the directors or if such provision specifies that it may be amended by the directors. The Colorado Bylaws provide that the Colorado Bylaws may at any time and from time to time be amended, supplemented, or repealed by the Board or the shareholders	Generally, under Texas law, the board of directors may amend, repeal or adopt a corporation’s bylaws. However, a corporation’s certificate of formation may reserve this power exclusively to a majority of the shareholders. Similarly, the shareholders, in amending, repealing or adopting a particular bylaw, may expressly provide that the board of directors may not amend, readopt or repeal that bylaw. Texas case law permits the corporation to increase the required threshold of shareholders necessary to amend the Texas Bylaws. The proposed Texas Certificate allows amendments to the Texas Bylaws by the vote of at least 2/3 of the members of the board of directors or by 2/3 of the holders of the outstanding shares entitled to vote, provided that any amendment to the Bylaw Anti-takeover Provisions requires approval by either (i) a majority of the continuing and unaffiliated directors and holders of a majority of the Texas Entity’s outstanding shares; or (ii) a majority of all of the Texas Entity’s directors and holders of at least 66 and 2/3% of the Texas Entity’s outstanding shares not held by the “affiliated shareholder.”

Removal of Director
Colorado	Texas
Under the CCAA, one or more directors may be removed from office by the shareholders with or without cause, unless a corporation’s articles of incorporation provide that directors may be removed only for cause, and only if the number of votes cast in favor of removal exceeds the number of votes cast against removal. The Colorado Articles do not prohibit shareholders from removing a director without cause. The Colorado Bylaws provide that shareholders may remove directors from office with or without cause at a shareholder meeting duly called for such purpose, only if the number of votes cast in favor of removal exceeds the number of votes cast against such removal.	Under Texas law, subject to the exceptions discussed below or as otherwise provided by the certificate of formation or bylaws of a corporation, the shareholders may remove a director, with or without cause, by a vote of the holders of a majority of the shares entitled to vote at an election of the directors. If the corporation’s directors serve staggered terms, a director may not be removed, except for cause unless the certificate of formation provides otherwise. The proposed Texas Bylaws are consistent with the TBOC regarding mechanics for removal of directors.

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Number of Directors
Colorado	Texas
Under the CCAA, the number of directors must be specified in the corporation’s bylaws. The Colorado Articles provide that the number of directors may be stated in or fixed in accordance with the Colorado Bylaws. The Colorado Bylaws provide that the number of directors of the Colorado Entity shall be fixed from time to time by the Board, but no decrease shall have the effect of shortening the term of any incumbent director.	The TBOC provides that, after specifying the initial number of directors in the certificate of formation, the number of directors will be set by or in the manner provided in the certificate of formation or the bylaws. The proposed Texas Bylaws provide that the size of the board will be determined by the board of directors.

Director Term of Office
Colorado	Texas
The CCAA permits (but does not require) classifications of a corporation’s board of directors. The Colorado Bylaws provide that the Colorado Entity's directors be elected annually. All directors hold office until the next annual meeting of shareholders following their election or until their successors are elected and qualified, or until their earlier death, resignation or removal.	The TBOC does not specify a term of office for the directors; however, the proposed Texas Bylaws provide that the number of directors of the corporation shall be set from time to time by resolution of the Board of Directors, but in no instance shall there be less than one director. Each director shall hold office until the next annual meeting of shareholders or until his or her successor shall have been elected and qualified. Directors need not be residents of the State of Texas or shareholders of the corporation.

Board of Directors Vacancies
Colorado	Texas
Under the CCAA, unless otherwise provided in the articles of incorporation, any vacancy on the board of directors, including a vacancy resulting from an increase in the number of directors, may be filled by the shareholders or the board of directors, except that if the directors remaining in office constitute fewer than a quorum, the board of directors may fill the vacancy by the affirmative vote of a majority of the remaining directors. The Colorado Articles do not alter the procedures specified in the CCAA. The Colorado Bylaws provide that any vacancy on the Board may be filled by a majority of the remaining directors in office or by the shareholders at the next annual meeting or at a special meeting called for that purpose.	The TBOC does not specify a procedure to fill a vacancy on the Board of Directors; however, the proposed Texas Bylaws provide that any vacancy occurring in the Board of Directors may be filled by the affirmative vote of a majority of the shareholders or the Board of Directors. If the directors remaining in office constitute less than a quorum of the Board, the directors may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office.

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Cumulative Voting; Vote Required for the Election of Directors
Colorado	Texas
Under the CCAA, shareholders have the right to cumulate their votes in the election of directors unless otherwise provided in the articles of incorporation. In addition, the CCAA provides that, absent a provision to the contrary in a corporation’s articles of incorporation, the election of directors will be by a plurality vote of the shareholders entitled to vote. The Colorado Articles expressly prohibit cumulative voting for the election of directors. The Colorado Articles do not alter the default plurality voting standard for the election of directors and the Colorado Bylaws specifically adopt a plurality voting standard for the election of the Colorado Entity’s directors.	The TBOC provides that a shareholder does not have the right to cumulate the shareholder's vote in the election of directors, unless expressly authorized by a corporation’s certificate of formation. The proposed Texas Certificate does not authorize cumulative voting and instead expressly prohibits cumulative voting.

Shareholders Rights to Examine Books and Records
Colorado	Texas
Under the CCAA, any record or beneficial shareholder of a corporation may, upon five days’ written demand, inspect certain records, including shareholder actions, minutes of shareholder meetings, communications with shareholders and recent financial statements. In addition, upon five days’ written demand, any such shareholder may inspect the list of shareholders and certain other corporate records, including minutes of the meetings of the board of directors of the corporation, if the shareholder either (i) has been a shareholder for at least three months; or (ii) is a holder of at least 5% of all outstanding shares of any class of shares when the demand is made, provided that the demand is made in good faith for a proper purpose reasonably related to such person’s interests as a shareholder. Neither the Colorado Articles nor the Colorado Bylaws contains a provision regarding examination rights.	Under Texas law, a shareholder may, upon written demand stating a proper purpose, inspect the books and records of a corporation if such shareholder holds at least 5% of the outstanding shares of stock of the corporation or has been a holder of shares for at least six months prior to such demand.

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Dividends, Distributions and Repurchases of Shares
Colorado	Texas
Unlike the Delaware General Corporate Law ("DGCL"), the CCAA does not utilize the concept of par value of shares or contain statutory definitions of capital, surplus and the like. The CCAA permits a corporation to declare and pay cash or in-kind property dividends or to repurchase shares unless, after giving effect to the transaction: (i) the corporation would not be able to pay its debts as they become due in the usual course of business; or (ii) the corporation’s total assets would be less than the sum of its total liabilities plus (unless the articles of incorporation permit otherwise) the amount that would be needed, if the corporation were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution. The Colorado Articles permit the Board to declare and pay dividends upon the Colorado Entity Common Stock out of any funds legally available therefor at such times and in such amounts as the Board shall determine, subject to preferential dividend rights, if any, of the holders of the Colorado Entity's preferred stock.	Under Texas law, a distribution is defined as a transfer of cash or other property (except a corporation’s own shares or rights to acquire its shares), or an issuance of debt, by a corporation to its shareholders in the form of: (i) a dividend on any class or series of the corporation’s outstanding shares; (ii) a purchase or redemption, directly or indirectly, of its shares; or (iii) a payment in liquidation of all or a portion of its assets. Under Texas law, a corporation may not make a distribution if such distribution violates its certificate of formation or, unless the corporation is in receivership, if it either renders the corporation unable to pay its debts as they become due in the course of its business or affairs, or exceeds, depending on the type of distribution, either the net assets or the surplus of the corporation. The proposed Texas Bylaws provide that dividends may be declared as provided by law.

Stock Redemption and Repurchase
Colorado	Texas
The CCAA permits a corporation to declare and pay cash or in-kind property dividends or to repurchase shares unless, after giving effect to the transaction: (i) the corporation would not be able to pay its debts as they become due in the usual course of business; or (ii) the corporation’s total assets would be less than the sum of its total liabilities plus (unless the articles of incorporation permit otherwise) the amount that would be needed, if the corporation were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution. The Colorado Articles permit the Board to declare and pay dividends upon the Colorado Entity Common Stock out of any funds legally available therefor at such times and in such amounts as the Board shall determine, subject to preferential dividend rights, if any, of the holders of the Colorado Entity’s preferred stock.	As noted above, under Texas law, the purchase or redemption by a corporation of its shares constitutes a distribution. Accordingly, any such purchase or redemption is subject to the restrictions on distributions discussed above.

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Transactions with Officers and Directors
Colorado	Texas
The CCAA contains a provision regarding interested transactions between a corporation and its directors (and not officers of a corporation). Neither the Colorado Articles nor the Colorado Bylaws modify the CCAA provisions with respect to transactions with directors.	The TBOC is silent on this issue; however, Texas case law imposes fiduciary duties where officers and directors have a duty of loyalty and such officers and directors may not usurp corporate opportunities. Moreover, the Texas Entity’s Code of Ethics provides: our Insiders and their Family Members must not profit, directly or indirectly, due to their position in the Texas Entity to the detriment, or at the expense, of the Texas Entity or any business associate. No insider shall take for his or her own advantage any corporate opportunity for profit, which he or she learns about in his or her position with the Texas Entity.

Limitation of Liability of Directors
Colorado	Texas
The CCAA permits a corporation to include a provision in its articles of incorporation eliminating the liability of a director to the corporation or its shareholders for monetary damages for breach of the director’s fiduciary duty in certain cases. Under the CCAA, a provision eliminating the liability of a director to the corporation or its shareholders for monetary liability for breach of the director’s fiduciary duty in certain cases must be contained in the corporation’s articles of incorporation. In addition, a director may not be exculpated from liability: (i) for any breach of the director’s duty of loyalty to the corporation or its shareholders; (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; (iii) arising from transactions relating to certain unlawful distributions; or (iv) for any transaction from which the director derived an improper personal benefit. The Colorado Articles exculpates directors of the Colorado Entity from personal liability for all monetary damages for breach of fiduciary duty as a director to the fullest extent allowed under the CCAA, except that the Colorado Articles do not eliminate or limit the liability of the Colorado Entity’s directors for monetary damages otherwise existing for: (i) any breach of the director’s duty of loyalty to the Colorado Entity’s or to its shareholders; (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) certain acts specified in the CCAA relating to any unlawful distribution; or (iv) any transaction from which the director directly or indirectly derived any improper personal benefit.	Texas law permits a corporation to eliminate in its certificate of formation all monetary liability of a director to the corporation or its shareholders for conduct in the performance of such director’s duties. Texas law does not, however, permit any limitation of the liability of a director for: (i) a breach of the duty of loyalty to the corporation or its shareholders; (ii) an act or omission not in good faith that constitutes a breach of duty of the person to the corporation or involves intentional misconduct or a knowing violation of law; (iii) a transaction from which the director obtains an improper benefit; or (iv) a violation of applicable statutes which expressly provide for the liability of a director. The proposed Texas Certificate eliminates the monetary liability of a director to the fullest extent permitted by applicable law.

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Indemnification of Directors and Officers

Colorado

Texas

The CCAA provisions regarding indemnification rights are substantially similar to the provisions contained in the DGCL, except as noted below.

In addition to the limitations of the DGCL, the CCAA prohibits a corporation from indemnifying a director, officer, employee or agent of a corporation (each, an “Indemnitee”) adjudged liable of receiving an improper personal benefit.

The CCAA also allows a corporation to indemnify an Indemnitee who is not a director to a greater extent than specified in the CCAA, if not inconsistent with public policy. However, a corporation may only indemnify a director as specified in the CCAA.

The CCAA requires a corporation to provide its shareholders with written notice of any indemnification payments or expense advancements paid to a director on or before the notice of the next shareholders meeting after making such payments.

Under the CCAA, the specified “Standard of Conduct” requires that an Indemnitee acted (i) in good faith; (ii) in a manner the Indemnitee reasonably believed to be, in the case of conduct in the Indemnitee’s official capacity, in the best interests of the corporation, and, for all other conduct, at least not opposed to the best interests of the corporation; and (iii) with respect to any criminal action or proceeding, with no reasonable cause to believe the Indemnitee’s conduct was unlawful.

The Colorado Articles require the Colorado Entity to indemnify any person who is or was a director of the Colorado Entity to the fullest extent allowed by the laws of Colorado, or while serving as a director or officer, also served at the request of the Colorado Entity as a director, officer, partner, trustee, employee, fiduciary or agent of another entity or employee benefit plan. The Colorado Articles also require the Colorado Entity to indemnify any person who is or was an officer, employee or agent of the Colorado Entity to the fullest extent allowed by the laws of Colorado or to a greater extent if consistent with law and if provided in the Colorado Bylaws, by resolution of the Colorado Entity’s shareholders or directors or in a contract.

Additionally, the Colorado Bylaws provide that the Colorado Entity may indemnify a director, officer or agent or former director, officer or agent against liability in the proceeding if such person acted with the required Standard of Conduct.

Further, the Colorado Bylaws provide that the Colorado Entity must indemnify a director or former director for reasonable expenses if such person is successful in the defense of any proceeding to which such person was a party because such person was or is a director.

Texas law permits a corporation to indemnify a director or former director, against judgments and expenses reasonably and actually incurred by the person in connection with a proceeding if the person: (i) acted in good faith, (ii) reasonably believed, in the case of conduct in the person’s official capacity, that the person’s conduct was in the corporation’s best interests, and otherwise, that the person’s conduct was not opposed to the corporation’s best interests, and (iii) in the case of a criminal proceeding, did not have a reasonable cause to believe the person’s conduct was unlawful.

If, however, the person is found liable to the corporation, or is found liable on the basis he received an improper personal benefit, then indemnification under Texas law is limited to the reimbursement of reasonable expenses actually incurred and no indemnification will be available if the person is found liable for: (i) willful or intentional misconduct in the performance of the person’s duty to the corporation; (ii) breach of the person’s duty of loyalty owed to the enterprise; or (iii) an act or omission not committed in good faith that constitutes a breach of a duty owed by the person to the corporation.

The proposed Texas Bylaws provide for indemnification of directors and officers (including advancement of expenses) to the fullest extent permitted by applicable law.

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Procedure for Indemnification
Colorado	Texas
Colorado statutes do not provide a specific procedure for indemnification.	Texas law provides that a determination that indemnification is appropriate must be made: (i) by a majority vote of the directors who, at the time of the vote, are disinterested and independent, regardless of whether such directors constitute a quorum; (ii) by a majority vote of a special committee of the board of directors if the committee is designated by a majority vote of the directors who at the time of the vote are disinterested and independent and is composed solely of one or more directors who are disinterested and independent; (iii) by special legal counsel selected by majority vote under (i) or (ii) above; (iv) by the shareholders in a vote that excludes those shares held by directors who, at the time of the vote, are not disinterested and independent; or (v) by a unanimous vote of the shareholders of the corporation.

Advancement of Indemnification Expenses
Colorado	Texas
Under the CCAA, a corporation may advance reasonable expenses to the Indemnitee in advance of the final disposition of a proceeding upon (i) a written affirmation of the Indemnitee’s good faith belief that the Indemnitee met the specified Standard of Conduct; and (ii) a written undertaking by or on behalf of the Indemnitee to repay such amount to the corporation if it is ultimately determined that the Indemnitee did not meet the specified Standard of Conduct. The Colorado Bylaws provide that reasonable expenses (including attorneys’ fees) incurred in defending an action, suit or proceeding may be paid by the Colorado Entity to any Indemnitee in advance of the final disposition of such action, suit or proceeding upon receipt of (i) a written affirmation of such Indemnitee’s good faith belief that he or she has met the Standard of Conduct; (ii) a written undertaking to repay such advances if it is ultimately determined that he or she did not meet the prescribed Standard of Conduct; and (iii) a determination is made by the Colorado Entity that the facts as then known to the Colorado Entity would not prohibit indemnification.	Texas law permits a corporation to indemnify a director or former director, against judgments and expenses reasonably and actually incurred by the person in connection with a proceeding if the person: (i) acted in good faith; (ii) reasonably believed, in the case of conduct in the person’s official capacity, that the person’s conduct was in the corporation’s best interests, and otherwise, that the person’s conduct was not opposed to the corporation’s best interests; and (iii) in the case of a criminal proceeding, did not have a reasonable cause to believe the person’s conduct was unlawful. If, however, the person is found liable to the corporation, or is found liable on the basis he received an improper personal benefit, then indemnification under Texas law is limited to the reimbursement of reasonable expenses actually incurred and no indemnification will be available if the person is found liable for: (i) willful or intentional misconduct in the performance of the person’s duty to the corporation; (ii) breach of the person’s duty of loyalty owed to the enterprise; or (iii) an act or omission not committed in good faith that constitutes a breach of a duty owed by the person to the corporation. The proposed Texas Bylaws provide for indemnification of directors and officers (including advancement of expenses) to the fullest extent permitted by applicable law.

Mandatory Indemnification
Colorado	Texas
Unless limited by its articles of incorporation, a corporation shall indemnify an individual who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the individual was a party because the individual is or was a director, against reasonable expenses incurred by the individual in connection with the proceeding. CCAA 7-109-103.	Under Texas law, indemnification by the corporation for reasonable expenses actually incurred is mandatory only if the director is wholly successful on the merits or otherwise, in the defense of the proceeding.

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Insurance
Colorado	Texas
A corporation may purchase and maintain insurance on behalf of a person who is or was a director, officer, employee, fiduciary, or agent of the corporation, or who, while a director, officer, employee, fiduciary, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, agent, associate, employee, fiduciary, manager, member, partner, promoter, or trustee of, or in any other capacity with, another person or an employee benefit plan, against liability asserted against or incurred by the person in that capacity or arising from the person’s status as a director, officer, employee, fiduciary, or agent, whether or not the corporation would have power to indemnify the person against the same liability. CCAA 7-109-108.	Texas law is substantially the same as the Colorado statute on this issue.

Persons Covered
Colorado	Texas
The persons covered by indemnification and insurance shall include a person who is or was a director, officer, employee, fiduciary, or agent of the corporation, or who, while a director, officer, employee, fiduciary, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, agent, associate, employee, fiduciary, manager, member, partner, promoter, or trustee of, or in any other capacity with, another person or an employee benefit plan, CCAA 7-109-108.	Texas law expressly and separately addresses the indemnification of officers, employees and agents. The corporation may indemnify and advance expenses to an officer, employee or agent as provided by the corporation’s governing documents, general or specific action of the board of directors, resolution of the shareholders, contract, or common law. The corporation must indemnify an officer to the same extent as a director. The procedure for indemnification under Texas law summarized above need not be followed for officers, employees or agents.

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Standard of Care
Colorado	Texas
A director is liable, as a director, to the corporation or to its shareholders for money damages for any act, omission to act, or decision only if the party asserting liability establishes in a proceeding that the challenged act, omission, or decision: (a) Was not in good faith; (b) Was one that the director did not rationally believe to be in the best interests of the corporation; (c) Was one as to which the director was at least grossly negligent, unless the articles of incorporation change the standard of liability to knowing misconduct, knowing violation of law, or negligence; (d) Was one as to which the director failed to make or cause to be made appropriate inquiry, when particular facts or circumstances of significant concern came to the attention of the director that would have alerted a reasonably attentive director to the need for inquiry; (e) Consisted of or resulted from a sustained or systematic failure by the director to exercise oversight of the business and affairs of the corporation; (f) Was a breach of the director’s duty of loyalty to the corporation, including by directly or indirectly receiving an improper personal benefit; or (g) Consisted of or resulted from an unlawful distribution. CCAA 7-108-402.	Texas law imposes duties of loyalty, care and obedience on directors of Texas corporations, but will generally not, absent fraud, impose liability upon a non-interested director unless the action challenged is outside of the expressed purpose of the corporation or inconsistent with an express limitation on authority. Directors of a Texas corporation owe fiduciary duties only to the corporation.

Shareholder Rights Plans
Colorado	Texas
Colorado statutes has no statute relating to this issue.	Texas law statutorily approves shareholder rights plans.

Considerations of Directors
Colorado	Texas
Unless otherwise provided in the bylaws, the board of directors may fix the compensation of directors. CCAA 7-108-111.	Texas corporate law includes statutory approval of directors considering both the long-term and short-term interests of the corporation and the shareholders.

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Shareholder Actions
Colorado	Texas
(1) No action shall be commenced by a shareholder in the right of a domestic or foreign corporation by a shareholder unless the plaintiff was a shareholder of the corporation at the time of the transaction of which the plaintiff complains. (2) In any action in the right of any domestic or foreign corporation by a shareholder, upon final judgment and a finding that the action was commenced without reasonable cause, shall require the plaintiff to pay to the defendants the costs and reasonable expenses directly attributable to the defense of such action. (3) In any action in the right of any domestic or foreign corporation by a shareholder holding less than five percent of the outstanding shares of any class, unless the shares so held have a market value in excess of $25,000, the corporation in whose right such action is commenced shall be entitled, at any time before final judgment, to require the plaintiff to give security for the costs and reasonable expenses which may be directly attributable to and incurred by it in the defense of such action or may be incurred by other parties named as defendant for which it may become legally liable, but not including fees of attorneys. CCAA 7-107-402.	Texas generally requires that lawsuits against directors be brought derivatively by the corporation only after making demand on the corporation’s board setting out the contours of the demand. A proceeding may not be commenced until the 91^st day after the written demand was filed with the corporation. Texas law may, in certain circumstances, such as in a proceeding determining liability of directors, allow for a jury trial.
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Dissenters’ Rights of Appraisal; Appraisal Rights
Colorado Texas
Under the CCAA, a properly dissenting shareholder is entitled to receive the appraised value of the shares owned by the shareholder when the corporation votes to: (i) sell, lease or exchange all or substantially all of its property and assets other than in the regular course of the corporation’s business; (ii) merge or consolidate with another corporation; (iii) participate in a share exchange; or (iv) convert into another entity, subject to certain exceptions, including, in certain circumstances, with respect to a company listed on a national securities exchange or that has more than 2,000 shareholders. Dissenters’ rights under the CCAA are available to both record holders and beneficial holders. Neither the Colorado Articles nor the Colorado Bylaws modify the CCAA provisions relating to dissenters’ rights. CCAA 7-113-102.	Except for the limited classes of mergers, consolidations, sales and asset dispositions for which no shareholder approval is required under Texas law, shareholders of Texas corporations with voting rights have dissenters’ rights in the event of a merger, consolidation, conversion, sale, lease, exchange or other disposition of all, or substantially all, the property and assets of the corporation. However, a shareholder of a Texas corporation has no dissenters’ rights with respect to any plan or merger or conversion in which there is a single surviving or new domestic or foreign corporation, or with respect to any plan of exchange if: (1) the ownership interest, or a depository receipt in respect of the ownership interest, held by the owner is part of a class or series of ownership interests, or depository receipts in respect of ownership interests, that are, on the record date set for purposes of determining which owners are entitled to vote on the plan of merger, conversion, or exchange, as appropriate: (A) listed on a national securities exchange (the Texas Entity currently meets this condition by virtue of its listing on the NASDAQ market); or (B) held of record by at least 2,000 owners; (2) the owner is not required by the terms of the plan of merger, conversion, or exchange, as appropriate, to accept for the owner’s ownership interest any consideration that is different from the consideration to be provided to any other holder of an ownership interest of the same class or series as the ownership interest held by the owner, other than cash instead of fractional shares or interests the owner would otherwise be entitled to receive; and (3) the owner is not required by the terms of the plan of merger, conversion, or exchange, as appropriate, to accept for the owner’s ownership interest any consideration other than: (A) ownership interests, or depository receipts in respect of ownership interests, of another entity of the same general organizational type that, immediately after the effective date of the merger, conversion, or exchange, as appropriate, will be part of a class or series of ownership interests, or depository receipts in respect of ownership interests, which are: (i) listed on a national securities exchange or authorized for listing on the exchange on official notice of issuance; and (ii) held of record by at least 2,000 owners; (B) cash instead of fractional ownership interests the owner would otherwise be entitled to receive; or (C) any combination of the ownership interests and cash above.

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Forum Selection
Colorado	Texas
(1) The articles of incorporation or the bylaws may require that any or all internal corporate claims must be brought exclusively in any specified court of this state and, if so specified, in any additional courts in this state or in any other jurisdiction with which the corporation has a reasonable relationship. (2) No provision of the articles of incorporation or the bylaws may prohibit bringing an internal corporate claim in the courts of this state or require the claims to be determined by arbitration. CCAA 7-102-108.	Texas law does not have an authorizing statutory provision similar to the forum selection provision in the Colorado statutes. The proposed Texas Bylaws that contain references to the TBOC and Texas law and provide that the exclusive forum shall be the United States District Court for the Southern District of Texas, or if that court lacks jurisdiction, state district courts of Harris County, Texas

Franchise Tax
Colorado	Texas
There is no franchise tax.	Texas has no corporate income tax; however, Texas does impose a franchise tax on taxable entities doing business in the state. A taxable entity’s Franchise tax liability is calculated by (I) first, determining the entity’s “margin,” which equals the lowest of (a) 70% of its total revenue, (b) its total revenue minus $1 million, (c) its total revenue minus COGS, or (d) its total revenue minus certain compensation expenses, and (II) second, determining the entity’s “taxable margin” by multiplying its “margin” by an apportionment percentage equal to its gross receipts only from its business in Texas divided by its gross receipts from its business everywhere, and (III) last, multiplying the entity’s “taxable margin” by a tax rate of 0.75% (unless it is primarily engaged in retail or wholesale trade, in which case the tax rate is 0.375%). The discussion of the Texas franchise tax set forth above is for general information only and does not purport to be a complete discussion or analysis of all potential franchise tax consequences that may apply to the Texas Entity. For a more detailed description explanation, see the Texas Comptroller’s office website.

The foregoing summary does not purport to be a complete statement of the respective rights of holders of our common stock and the Texas Entity common stock, and is qualified in its entirety by reference to the CCAA and the TBOC, respectively, and to the Colorado Articles and the Colorado Bylaws and to the Texas Certificate and the Texas Bylaws, respectively.

Required Vote

If a quorum is present, approval of this proposal requires the affirmative vote of a majority of the outstanding shares of the Colorado Entity’s common stock entitled to vote on this proposal at the Annual Meeting. Because matters considered “routine” by the applicable regulations, such as ratification of auditors, are under consideration at the Annual Meeting, abstentions and broker non-votes will be counted towards a quorum, but these abstentions, broker non-votes, and any other outstanding shares that are not voted will have the effect of a vote “AGAINST” the proposal.

The Board of Directors recommends a vote “FOR” approval of the conversion of the Colorado Entity’s domicile state from the State of Colorado to the State of Texas.

Other Business

Management does not presently know of any matter that may be presented for action at this Annual Meeting other than as set forth herein. However, if any other matters properly come before this Annual Meeting, it is the intention of the persons named in the proxies solicited by management to exercise their discretionary authority to vote the shares represented by all effective proxies on such matters in accordance with their best judgment or as instructed by the shareholder.

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Corporate Overview

Orbital Energy Group, Inc. and its subsidiaries (Nasdaq: OEG), formerly known as CUI Global Inc., are collectively referred to as ‘‘Orbital Energy Group,’’ the “Company,” or “OEG.” Orbital Energy Group is a Colorado corporation incorporated on April 21, 1998, with its principal place of business located at 1924 Aldine Western, Houston, Texas 77038, phone (832) 467-1420. The Company is a diversified infrastructure services company serving customers in the electric power, telecommunications, and renewable markets. Our website address is www.OrbitalEnergyGroup.com. Information contained in our website is not incorporated by reference into this prospectus supplement and should not be considered to be a part of this prospectus supplement. You should not rely on our website or any such information in making your decision whether or not to purchase our common stock.

In the fourth quarter of 2021, the Company's continuing operations were reclassified into three reportable segments, which include the Electric Power segment, the Telecommunications segment, and the Renewables segment. The Company’s corporate overhead activities are included in the “Other” segment category. Orbital Energy Group has continuing operations in two countries, including the United States and India.

In December 2021, the Company substantially reduced operations of its Integrated Energy Infrastructure Solutions and Services segment comprised of Orbital Gas Systems, North America, and Orbital Gas Systems, Ltd. (Orbital-UK). The Company considered these two subsidiaries discontinued operations in December 2021.

Electric Power Segment

Front Line Power Construction, LLC, and Subsidiary (Eclipse Foundation Group, Inc.) and Orbital Power, Inc.

The Electric Power segment consists of Front Line Power Construction, LLC based in Houston, Texas, Orbital Power, Inc. based in Dallas, Texas, and Eclipse Foundation Group based in Gonzales, Louisiana. The segment provides comprehensive network solutions to customers in the electric power industry. Services performed by Front Line Power and Orbital Power, Inc. generally include the design, installation, upgrade, repair and maintenance of electric power transmission and distribution infrastructure and substation facilities as well as emergency restoration services.. Eclipse Foundation Group, which began operations in January 2021, is a drilled shaft foundation construction company that specializes in providing services to the electric transmission and substation, industrial, telecommunication and disaster restoration market sectors, with expertise performing services in water, marsh and rock terrains.

Telecommunications Segment

Gibson Technical Services, LLC and Subsidiaries (IMMCO, Inc. and Full Moon Telecom, LLC)

The Telecommunications segment consists of Gibson Technical Services (GTS) along with its subsidiaries IMMCO, Inc., based in Atlanta, Georgia and Full Moon Telecom, LLC based in Florida. GTS provides engineering, design, construction, and maintenance services to the broadband and wireless telecommunication industries and was acquired by the Company effective April 13, 2021. IMMCO, Inc. provides enterprise solutions to the cable and telecommunication industries and was acquired by the Company effective July 28, 2021. Full Moon Telecom, LLC provides telecommunication services including an extensive array of wireless service capabilities and was acquired by the Company effective October 22, 2021.

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Renewables Segment

Orbital Solar Services, LLC.

Orbital Solar Services, LLC (OSS), based in Raleigh, North Carolina, makes up the Renewables segment. OSS provides engineering, procurement and construction (“EPC”) services that support the development of renewable energy generation focused on utility-scale solar construction.

Discontinued Operations

On December 28, 2021, the Orbital Energy Group, Inc. Board of Directors approved management’s recommendation for certain restructuring and costs reduction actions to strategically reposition the Company’s business to focus on a strategy to build an infrastructure services company serving the electric power, telecommunications and renewable markets by authorizing divestment of two (2) Orbital Gas subsidiaries, Orbital Gas Systems, North America, Inc. (“OGSNA”) and Orbital Gas Systems, Ltd. (“Orbital UK”). These two subsidiaries provide proprietary gas measurement and sampling technologies and integration of process control and measuring/sampling systems.

Directors and Executive Officers

Our bylaws permit the number of directors to be fixed by resolution of the board of directors, but to be no less than one. The board of directors has set the maximum number of members to no more than twelve members. Directors are elected by a majority of the votes cast by the stockholders and serve a one-year term or until their successors have been elected and qualified or their earlier resignation or removal. During 2021 the board of directors appointed three additional directors (Paul T. Addison, Jerry Sue Thornton, La Forrest V. Williams) who qualify as “independent director” as defined by applicable rules promulgated by the Securities and Exchange Commission and within the meaning of Rule 5605(a)(2) of the Nasdaq Stock Market.

The board of directors has five standing committees: Audit Committee, Disclosure Com

SEC Form DEF 14A filed by Orbital Energy Group Inc.