Company: SCAG
Filing Date: 2025-11-12
Form Type: 20-F
Source: 0001213900-25-109190
Chunk: 206

Company: Scage Future
Filing Date: 2025-11-12
Form: 20-F
Item: Item 19
Chunk 206
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 - Stock Compensation (“ ASC 718”), to account for all of its share-based payments.
In accordance with ASC 718, the Group determines whether an award should be classified and accounted for as a liability award or equity
award. All the Group’s grants of share-based awards were classified as equity awards and are recognized in the financial statements
based on their grant date fair values.

(x)
The Group has elected to recognize compensation expense using the straight-line method for all awards granted with graded vesting over
the requisite service period. For awards with performance conditions, the Company would recognize compensation cost if and when it concludes
that it is probable that the performance condition will be achieved. The Group has also elected to account for forfeitures as they occur.
Previously recognized compensation cost for the awards is reversed in the period that the award is forfeited.

Currently,
the Group does not maintain any recurring stock-based incentive program, except for the one-off share-based payment to an external capital
market advisor in June 2025 (Note 17).

  (y)      Loss per share  

Basic
loss per share is computed by dividing net loss attributable to ordinary shareholders, taking into consideration the deemed dividends
to preferred shareholders (if any), by the weighted average number of ordinary shares outstanding during the year using the two-class
method. Under the two-class method, net loss is allocated between ordinary shares and other participating securities based on their participating
rights. Shares issuable for little to no consideration upon the satisfaction of certain conditions are considered as outstanding shares
and included in the computation of basic loss per share as of the date that all necessary conditions have been satisfied. Net losses
are not allocated to other participating securities if based on their contractual terms they are not obligated to share the losses.

The
Group’s convertible redeemable preferred shares are participating securities, as they have contractual nonforfeitable right to
participate in distributions of earnings. The convertible redeemable preferred shares have no contractual obligation to fund or otherwise
absorb the Group’s losses. Accordingly, any undistributed net income or loss is allocated on a pro rata basis to ordinary shares
and convertible redeemable preferred shares, whereas any undistributed net loss is allocated to ordinary shares only.

  (z)      Warrant  
 ────────────────────

The Group accounts for warrants
as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable
authoritative guidance in ASC 480 and ASC 815. The assessment considers whether