Material Information

2022-07-12

On behalf of Arizon RFID Technology (Cayman) Co., Ltd., YFY Inc. announced the the Board's resolution on issuing employee stock warrants

1.Date of the board of directors resolution:2022/07/12
2.Issuance period:
Arizon RFID Technology (Cayman) Co., Ltd. may, based on its actual needs,
grant options in one or more tranches within one (1) year from the date of
the consent by the Board. The actual date of the grant(“Grant Date”) shall
be determined by the Chairman of the Board (“Chairman”).
3.Eligibility criteria for optionees:
Eligibility is restricted to those who are full-time employees with superior
talent in the organizations of Arizon RFID Technology (Cayman) Co., Ltd. and
its control or subsidiary company. Eligibility for the options and the number
of options to be granted to each eligible employee shall be reviewed and
determined by the Chairman and approved by the Board of Arizon RFID
Technology (Cayman) Co., Ltd., after taking into consideration factors such
as job grade, job performance, overall contribution, special achievements
and seniority.
The cumulative number of shares that may be allocated to any single employee
of stock options in any fiscal year may not exceed 1 percent (1%) of the
total number of issued shares on the final day of the fiscal year.
4.Number of total issued units of the employee stock warrants:
The total number of employee stock options are 595 units, each stock option
unit may be converted into 1,000 common shares of Arizon RFID Technology
(Cayman) Co., Ltd. The total number of new common shares that may be issued
pursuant to the exercise of the stock options are 595,000 shares.
5.Number of shares each stock warrant unit may subscribe for:
1,000common shares.
6.Total number of new shares to be issued due to exercise of options, or the
no.of shares for shares buyback as required by Article 28-2 of the
Securities and Exchange Act:
The total number of new common shares that may be issued are 595,000 shares.
7.Subscription price:
Subscription price may not be less than the net asset value per share on the
latest audited financial statements of the Grant Date.
8.Period of subscription rights:
The stock options shall be valid for three years from the next day of Grant
Date and shall be expired after such period. During the period of
subscription, the options and rights herein may not be transferred, pledged,
assigned or otherwise disposed by the optionee, except by inheritance.
9.Types of shares which may be subscribed for:
The shares underlying the options shall be the common shares of Arizon RFID
Technology (Cayman) Co., Ltd.
10.Handling method for employee resignation/inheritance:
(1) Employees’ voluntary resignation or the dismissal based on the labor
standards law According to paragraph (2) of this Article, stock options that
are vested and exercisable shall be expired with ten days following the
resignation date, however, upon occurrence of the circumstances stipulated
in this Article, the expiration date of the options may be extended by the
same duration period. Any options that are unvested shall be deemed
forfeited on the resignation/dismissal date.
(2) Retirement
All unvested options shall vest at the date of retirement. However, the
stock options shall be exercised within ten days from the date of
retirement.
(3) Leave Without Pay
For optionees who have been approved by Arizon RFID Technology (Cayman)
Co., Ltd. for leave without pay, the vested and exercisable options
shall expire after ten days following the starting date of leave without
pay. However, that the vesting period shall be extended by the same
duration as the period of leave without pay, is, at all times, subject
to the original validity period of the options set forth in paragraph
(2) of this Article.
(4) Death
According to paragraph(2) of this Article, for options already vested,
the successor of such optionee may exercise the option within ten days
after the date of death. For the option not yet vested, the option
shall be null and void on the date of death. Anyone entitled to share
purchase rights under the options by statutory succession shall
complete the statutorily required procedures and provide relevant
documentary evidence in accordance with civil laws and the provisions
of shareholder services concerning transfer by inheritance. Only after
these procedures are complete may an application be submitted for the
exercise of the purchase rights to which the heir shall succeed.
However, no application and purchase procedures may be done beyond the
effective duration of the stock options.
(5) Disability or Death Caused by Work Injury
1. In the event an optionee is physically disabled and cannot continue
his/her employment due to work injury, all unvested options shall
vest at the date of termination of employment. The stock options
shall exercise within ten days from the termination date. However,
no application and purchase procedures may be done beyond the
effective duration of the stock options.
2. In the event of an optionee’s death as a result of a work injury,
all unvested options shall vest on the date of death. The stock
options shall exercise within ten days from date of death. However,
no application and purchase procedures may be done beyond the
effective duration of the stock options.
(6) Job position transfer to an affiliate
If, due to Arizon RFID Technology (Cayman) Co., Ltd.'s operational
needs, Arizon RFID Technology (Cayman) Co., Ltd. decides that it is
necessary to transfer a holder of Arizon RFID Technology (Cayman)
Co., Ltd.'s stock options to a position at a Arizon RFID Technology
(Cayman) Co., Ltd.'s affiliate, the transfer shall have no effect on
the rights and obligations in connection with the stock options
already allocated.
(7) Severance by labor standards law
For stock options that are already exercisable under the provisions
of paragraph (2) of this Article, the share purchase rights may be
exercised within ten days from the effective date of severance. For
stock options that have not yet become exercisable, the share
purchase rights shall be deemed forfeited from the effective date
of severance.
However, the rights of such options and exercise period may be
re-determined by Arizon RFID Technology (Cayman) Co., Ltd.’s
Chairman or its authorized executives in accordance with the
Vesting Schedule set forth in paragraph 2 of this Article.
(8) If optionee or successor do not exercise stock options during
above period, any options that are unvested shall be deemed
forfeited.
11.Other criteria for subscription:None
12.Method for performance of contract:
Arizon RFID Technology (Cayman) Co., Ltd. will issue new shares.
13.Adjustment of subscription price:
After the options are granted, upon the occurrence of certain events
relating to the change in the number of common shares of Arizon RFID
Technology (Cayman) Co., Ltd. (including capital increased by cash,
retained earnings transferred to capital, capital surplus transferred
to capital, consolidation, stock split, and issue of overseas
depositary receipts for a cash capital increase), the exercise price
of each option shall be subject to adjustment in accordance with the
following formula.
Adjusted exercise price =
Exercise price prior to adjustment × {(number of outstanding shares+
(total number of newly issued shares × amount paid per share)/
Exercise price prior to adjustment}/( total number of outstanding
shares + total number of newly issued shares)
(a) Total number of outstanding shares refers to total number of
outstanding common shares and is exclusive of option payment
evidences and the number of certificates of entitlement to new
shares from convertible bond.
(b) In the event the new shares are distributed gratis or resulting
from split of stocks, the amount of payment per share is zero.
(c) When new shares are issued in connection with a merger, the
”amount paid per share” shall be the average closing price of
Arizon RFID Technology (Cayman) Co., Ltd. common shares for the
30 business days preceding the record date of the merger. And
before 45th business days of the consolidation date.
(d) Exercise price prior to adjustment to be rounded to the
nearest tenth.
(e) The exercise price will not be adjusted, if the adjusted
exercise price is higher than the exercise price prior to
adjustment.
(f) If the adjusted exercise price is lower than the par value of
common stock, the price is the par value of common stock.
(g) After the options are granted, appropriations of cash
dividends, reduce to the exercise price as cash dividends per
share.
14.Procedures for exercising options:
(A) Except during a book closure period as provided by law or
regulation and except as provided in the 2nd paragraph (5) of
this Article, the stock option holder may exercise share
purchase rights in accordance with these Rules, and may complete
a share purchase request and submit its application to Arizon
RFID Technology (Cayman) Co., Ltd.
(B) After processing the purchase request, Arizon RFID Technology
(Cayman) Co., Ltd. shall notify the stock option holder to pay
the share price at a designated bank. Once a stock option holder
has made a payment for a share purchase, the payment may not be
canceled.
(C) Once Arizon RFID Technology (Cayman) Co., Ltd. has verified
that the share price has been fully received, it will instruct
Arizon RFID Technology (Cayman) Co., Ltd. 's shareholder
services agent to enter the number of shares purchased by the
employee and the employee's name into Arizon RFID Technology
(Cayman) Co., Ltd. 's shareholder register, and deliver to the
holder of stock option the shares of new common stock issued
by Arizon RFID Technology (Cayman) Co., Ltd. after completing
amendment to the registration of capital amount, stock
printing, certification of stock, and other necessary process.
If the shares of common stock are TWSE listed /GTSM listed
/Emerging stock, they will be transferred within 5 business
days by book-entry through the central depository.
(D) It shall apply to the competent authority for company
registration to make an amendment to its registered capital
to reflect the shares that have been purchased under the
options at least once each quarter.
15.Rights and obligations after exercising options:
Common shares delivered after exercising the Options shall have
the same rights, obligations and privileges as holders of common
shares of the Company.
16.Record date for any additional share exchange, stock swap, or subscription:
None
17.Possible dilution of equity in case of any additional share exchange,
stock swap, or subscription:None
18.Other important terms and conditions:
(1) This Plan shall be approved by the Board and become effective. Amendment
for this Plan shall apply the same rule.
(2) Any other matters not set forth herein shall be dealt with in accordance
with relevant laws and regulations.
19.Any other matters that need to be specified:None