CL Workshop Group's 2026 Equity Incentive Plan: Implications for Shareholder Value and Corporate Governance

Based on comprehensive analysis of available data, CL Workshop Group Limited’s (formerly Nature Wood Group Limited, ticker: NWGL) 2026 equity incentive plan, combined with its recent corporate reorganization and Foreign Private Issuer (FPI) status, presents

[0][1][2].

The company’s adoption of a

and reliance on creates substantial governance risks, particularly given the company’s weak financial performance with negative profitability (-44.67% ROE) and deteriorating stock price (-85.42% over 3 years) [0].

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CL Workshop Group implemented a significant corporate restructuring effective December 29, 2025 [1]:

• From: “Nature Wood Group Limited” / “大自然林業集團有限公司”
• To: “CL Workshop Group Limited” / “刺梨工坊公司”

• Previous:
  Single-class ordinary shares
• New:
  Dual-class structure
  • Class A Ordinary Shares:
    92,932,850 shares (1 vote per share)
  • Class B Ordinary Shares:
    480,000,000 authorized (50 votes per share)
  • Current Issuance:
    132,425,321 total shares reclassified

8,000,000,000 ordinary shares [1]

This structure gives Class B holders (likely insiders/founders)

with minimal economic investment.

Metric	Value	Assessment
Market Cap	$23.17M	Micro-cap
Current Price	$1.40	Near 52-week low
3-Year Performance	-85.42%	Severe underperformance
ROE	-44.67%	Negative profitability
Net Margin	-32.24%	Loss-making operations
P/E Ratio	-5.53x	Negative earnings
Current Ratio	1.59	Adequate liquidity [0]

The company is

with significant operational challenges, raising questions about the necessity and appropriateness of new equity grants.

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While specific plan details are limited in publicly available information, typical equity incentive plans under these circumstances include:

• Stock Options:
  Right to purchase shares at predetermined exercise prices
• Restricted Stock Awards:
  Shares granted subject to vesting conditions
• Stock Appreciation Rights (SARs):
  Cash or stock settlements based on price appreciation
• Performance-Based Awards:
  Grants tied to financial or operational metrics

• Each new share issued under the incentive plan dilutes existing shareholders’ ownership percentage
• With only 132.4 million shares currently issued but 8 billion authorized, the
  potential dilution is enormous
• Current market cap of $23.17M suggests extreme downside risk if additional shares are issued at depressed prices

• Management can receive substantial equity compensation despite poor performance
• The dual-class structure means
  management faces minimal accountability
  to public shareholders
• Option grants may encourage excessive risk-taking rather than sustainable value creation

• Granting equity in an unprofitable company with declining stock is fundamentally misaligned with shareholder interests
• Management equity should reward
  value creation
  , not simply tenure

• If awards include cash-settled SARs or bonuses, the company’s already weak cash position (negative operating margin) could deteriorate further [0]

• Talent Retention:
  Could help retain key employees in challenging market conditions
• Performance Alignment:
  If strictly tied to profitability milestones and stock price recovery targets
• Cash Conservation:
  Equity-based compensation reduces immediate cash compensation burden

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As a company headquartered in Macau, CL Workshop Group qualifies as a

, allowing it to follow instead of Nasdaq requirements [3][4].

Nasdaq Rule	Requirement	FPI Exemption Impact
Rule 5635(a)(2)	Shareholder approval for equity compensation plans to officers/directors	May follow Macau rules - potentially no shareholder vote required [3]
Rule 5635©	Shareholder approval for material plan amendments	Home country exemption applicable [3][4]
Rule 5635(d)	20% issuance threshold requiring approval	Different standards may apply [3]
Rule 5605 series	Independent director and committee requirements	Macau standards may be less stringent [4]

Macau company law provides

[5]:

• Controlling shareholders have
  no special fiduciary duties
  to minority shareholders unless abuse of control is proven
• Minority shareholders must typically group together to exercise blocking rights
• Legal remedies exist but require proactive legal action through Macau courts
• No statutory requirement
  for shareholder approval of equity compensation plans at the U.S. standard level

This creates a

where the company can implement equity compensation with minimal minority shareholder input.

The 50:1 voting ratio between Class B and Class A shares creates

[1][2][6]:

• Class B holders can effectively control all shareholder decisions
• Minority shareholders have
  virtually no practical voting power
• Board members and management face minimal risk of removal

• Management can approve generous equity awards for themselves
• No meaningful shareholder oversight of compensation practices
• The “home country exemption” further reduces accountability [3][4]

• Separation of economic ownership (Class A) from control (Class B)
• Management’s interests may diverge significantly from minority shareholders
• Classic principal-agent problem with limited checks and balances

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The combination of

and effectively excludes minority shareholders from meaningful participation in critical decisions [1][3][6]:

• No vote on equity plan adoption:
  May not require shareholder approval under Macau law
• No say on plan amendments:
  Material changes can occur without minority input
• No oversight of grant practices:
  Individual award decisions made by controlled board
• Limited ability to replace management:
  50:1 voting ratio makes this practically impossible

Example Scenario (Illustrative):
- Plan grants 1,000,000 options to management at $1.40 strike
- Stock price recovers to $2.00
- Management gain: $600,000
- Minority shareholders: Dilution of ~0.75% without any benefit

, the [1].

While Macau law provides theoretical remedies for minority shareholders [5]:

• Must prove “abuse of controlling power” - a high legal threshold
• Requires litigation in Macau courts - expensive and time-consuming
• Must organize minority shareholders into a meaningful block
• No statutory damages provision - only actual damages recoverable
• No class action mechanism
  as exists in U.S. federal courts

This creates a

where violations may be legally actionable but practically unenforceable.

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Major proxy advisory firms and institutional investors express

about dual-class structures [6][7]:

• Recommends voting against directors of companies with “unfairly” entrenched dual-class structures
• Examines unaffiliated shareholder approval on “one share, one vote” basis
• Particular scrutiny when no reasonable sunset provision exists [6]

• Typically recommends withhold votes for governance committee chairs at dual-class companies without sunset provisions
• Closely examines related party transactions and compensation practices [6]

• Increased scrutiny
  of dual-class structures by regulators and investors
• Growing investor activism
  against governance abuses
• Emphasis on sunset provisions
  for high-vote shares (typically 7 years)
• Demand for alignment
  between voting rights and economic interests

with these governance trends.

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Risk Category	Severity	Key Concerns
Governance Risk	SEVERE	Dual-class + FPI exemption = minimal accountability
Dilution Risk	SEVERE	8B authorized vs. 132M issued = ~6,000% potential dilution
Value Destruction	HIGH	Loss-making operations + new equity grants
Liquidity Risk	MODERATE-HIGH	Low trading volume (avg. 48,906 shares/day)
Legal Risk	MODERATE	Limited remedies under Macau law; expensive to enforce

1. Review Form 6-K and Annual Reports
   for detailed plan provisions
   • Examine grant sizes, vesting schedules, and performance conditions
   • Identify related party transactions and insider grants
   • Assess total dilution impact

2. Exercise Limited Voting Rights:
   • Vote against management-sponsored proposals where possible
   • Support shareholder resolutions requesting enhanced disclosure
   • Coordinate with other minority shareholders (though difficult given fragmentation)

3. Consider Exit Strategy:
   • The governance structure and FPI exemptions create
     structural disadvantages
   • Stock’s 3-year decline of -85.42% suggests ongoing value destruction [0]
   • Limited ability to influence outcomes justifies position reassessment

4. Monitor Regulatory Developments:
   • Nasdaq and SEC are increasing scrutiny of FPI governance exemptions
   • Potential future regulatory changes could improve protections

1. Why is an equity incentive plan necessary for a loss-making company?
2. What specific performance metrics will be tied to awards?
3. What percentage of authorized shares will the 2026 plan utilize?
4. Why did the company adopt a dual-class structure?
5. Will there be a sunset provision for Class B high-vote shares?
6. How does the plan align management interests with minority shareholders?
7. Will the plan require shareholder approval under Macau law?

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CL Workshop Group’s 2026 equity incentive plan, implemented within the context of a newly-adopted dual-class share structure and reliance on Nasdaq’s home country exemption for Foreign Private Issuers, presents

[0][1][3][6].

1. Severe Governance Deficit:
   Dual-class structure (50:1 voting ratio) combined with FPI exemption effectively eliminates minority shareholder influence

2. Potential for Massive Dilution:
   8 billion authorized shares vs. 132 million currently outstanding creates enormous dilution potential

3. Misaligned Incentives:
   Equity grants in a loss-making company with declining stock rewards poor performance rather than value creation

4. Limited Minority Protections:
   Macau law provides weaker shareholder protections than U.S. corporate governance standards, with expensive and difficult enforcement mechanisms

5. Market Performance Concerns:
   -85.42% three-year stock decline and negative profitability raise fundamental questions about the company’s direction

that may warrant careful reassessment of investment positions, particularly given limited ability to effect change through traditional shareholder governance mechanisms.

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[0] 金灵AI数据 - Company Overview, Financial Analysis, Real-Time Quote for NWGL (2026-01-02)

[1] Stock Titan / PR Newswire - “Nature Wood Group Limited Announces Results of 2025 Annual General Meeting of Shareholders” (December 16, 2025) - Details share reorganization and dual-class structure implementation

[2] Stock Titan - “CL Workshop Group (NWGL) posts $8.9M H1 revenue” - Information about share authorization and corporate structure changes

[3] Legal and Compliance - “Foreign Private Issuers – SEC Registration and Reporting; Nasdaq Corporate Governance Part 3” - Explains FPI exemptions from Nasdaq Rule 5635

[4] Nasdaq Listing Rules - Rule 5615 and Rule 5250 - FPI home country practice exemptions

[5] Chambers Practice Guide - “Shareholders’ Rights & Shareholder Activism 2025 - Macau SAR China” - Macau corporate law framework and minority shareholder rights

[6] Glass Lewis - “2025 Benchmark Policy Guidelines United States” - Institutional investor policies on dual-class share structures and governance

[7] LinkedIn Corporate Governance Post (2025) - Current trends in dual-class share governance and accountability

[8] tandfonline.com - “The impact of dual-class share structures on the financial performance” (September 2025) - Academic research on dual-class governance implications