# EDGAR Filing Document

**Accession Number:** 0002108359
**File Stem:** 0001213900-26-061646
**Filing Date:** 2026-5
**Character Count:** 1002743
**Document Hash:** f69bdd16d5b8a9c6a33a3ab084d4b788
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-26-061646.hdr.sgml**: 20260528

**ACCESSION NUMBER**: 0001213900-26-061646

**CONFORMED SUBMISSION TYPE**: 10-12G

**PUBLIC DOCUMENT COUNT**: 20

**FILED AS OF DATE**: 20260528

**DATE AS OF CHANGE**: 20260527

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** BioKey (Cayman), Inc.
- **CENTRAL INDEX KEY:** 0002108359
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 000000000
- **STATE OF INCORPORATION:** E9
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-12G
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-56853
- **FILM NUMBER:** 261028052

**BUSINESS ADDRESS:**
- **STREET 1:** 44370 OLD WARM SPRINGS BLVD
- **CITY:** FREMONT
- **STATE:** CA
- **ZIP:** 94538
- **BUSINESS PHONE:** (510) 668-0881

**MAIL ADDRESS:**
- **STREET 1:** 44370 OLD WARM SPRINGS BLVD
- **CITY:** FREMONT
- **STATE:** CA
- **ZIP:** 94538

**As filed with the Securities and Exchange Commission on May 27, 2026.**

**File No. 001-[ ]**

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549**

**Form 10** 

**General Form for Registration of Securities** 

**Pursuant to Section 12(b) or (g) of** 

**The Securities Exchange Act of 1934** 

**BioKey (Cayman), Inc.**

**(Exact Name of Registrant as Specified in its Charter)** 

---

| | |
|:---|:---|
| **Cayman Islands** | **93-3535498** |
| **(State or Other Jurisdiction of<br> Incorporation or Organization)**<br>**44370 Old Warm Springs Blvd.**<br> **Fremont, CA, United States** | **(IRS Employer<br> Identification Number)**<br>**94538** |
| **(Address of Principal Executive Offices)** | **(Zip Code)** |
| **(845) 291-1291 <br> (Registrant's telephone number, including area code)** | **(845) 291-1291 <br> (Registrant's telephone number, including area code)** |

---

***Copies to:***

 ****

**T.S. Jiang<br> 44370 Old Warm Springs Blvd.**<br> **Fremont, CA, United States<br> (510)-668-0881**<br>

**Securities to be Registered Pursuant to Section 12(b) of the Act:** 

**None** 

**Securities to be Registered Pursuant to Section 12(g) of the Act:** 

**Title of Each Class to be so Registered** 

**Ordinary Shares, par value $0.0001**

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer ☐ Accelerated Filer ☐ <br> Non-Accelerated Filer ☒ Smaller Reporting Company ☒ <br> Emerging Growth Company ☒

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial standards provided pursuant to Section 13(a) of the Exchange Act: ☐

**BIOKEY (CAYMAN), INC.** 

**INFORMATION REQUIRED IN REGISTRATION STATEMENT** 

**CROSS-REFERENCE SHEET BETWEEN ITEMS OF FORM 10** 

**AND THE ATTACHED INFORMATION STATEMENT.** 

This Registration Statement on Form 10 of BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability (the "**Registrant**" or "**BioKey Cayman**"), incorporates by reference information contained in the information statement of BioKey Cayman filed as Exhibit 99.1 hereto (the "**Information Statement**"). None of the information contained in the Information Statement shall be incorporated by reference herein or deemed to be a part hereof unless such information is specifically incorporated by reference.

**Item 1. *Business*** 

The information required by this item is contained under the sections "Information Statement Summary," "Risk Factors," "Cautionary Statement Concerning Forward-Looking Statements," "Unaudited Pro Forma Condensed Consolidated Financial Statements," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Business," "Certain Relationships and Related Person Transactions," "Where You Can Find More Information" and "Index to Consolidated Financial Statements" and in the financial statements referenced in the information statement. Those sections are incorporated herein by reference.

**Item 1A. *Risk Factors***

The information required by this item is contained under the section of the information statement entitled "Risk Factors." That section is incorporated herein by reference.

**Item 2. *Financial Information***

The information required by this item is contained under the sections "Selected Historical and Unaudited Pro Forma Condensed Consolidated Financial Data," "Unaudited Pro Forma Condensed Consolidated Financial Statements," and "Management's Discussion and Analysis of Financial Condition and Results of Operations" of the Information Statement. Those sections are incorporated herein by reference.

**Item 3. *Properties***

The information required by this item is contained under the section "Business—Properties and Facilities" of the Information Statement. This section is incorporated herein by reference.

**Item 4. *Security Ownership of Certain Beneficial Owners and Management*** 

The information required by this item is contained under the section "Security Ownership of Certain Beneficial Owners and Management" of the Information Statement. The section is incorporated herein by reference.

**Item 5. *Directors and Executive Officers*** 

The information required by this item is contained under the section "Management and Board of Directors" of the Information Statement. The section is incorporated herein by reference.

**Item 6. *Executive Compensation*** 

The information required by this item is contained under the sections "Management and Board of Directors" and "Executive Compensation" of the Information Statement. Those sections are incorporated herein by reference.

**Item 7. *Certain Relationships and Related Transactions*, *and Director Independence***

The information required by this item is contained under the sections "Management and Board of Directors and "Certain Relationships and Related Party Transactions" of the Information Statement. Those sections are incorporated herein by reference.

**Item 8. *Legal Proceedings*** 

The information required by this item is contained under the section "Business—Legal Proceedings" of the Information Statement. This section is incorporated herein by reference.

**Item 9. *Market Price of and Dividends on the Registrant's Common Equity and Related Shareholder Matters*** 

The information required by this item is contained under the sections "The Spin-Off," "Dividend Policy," "Security Ownership of Certain Beneficial Owners and Management," and "Description of Our Capital Stock" of the Information Statement. Those sections are incorporated herein by reference.

**Item 10. *Recent Sales of Unregistered Securities***

None.

**Item 11. *Description of Registrant's Securities to be Registered*** 

The information required by this item is contained under the section "Description of Our Capital Stock" of the Information Statement. The section is incorporated herein by reference.

**Item 12. *Indemnification of Directors and Officers***

The information required by this item is contained under the sections "Description of Our Capital Stock" and "Certain Relationships and Related Party Transactions—Agreements with ABVC BioPharma, Inc. —Separation and Distribution Agreement" of the Information Statement. Those sections are incorporated herein by reference.

**Item 13. *Financial Statements and Supplementary Data***

The information required by this item is contained under the sections "Selected Historical and Unaudited Pro Forma Consolidated Financial Data," "Unaudited Pro Forma Consolidated Financial Statements," "Index to Consolidated Financial Statements" and the financial statements referenced therein beginning on page F-1 of the Information Statement. Those sections are incorporated herein by reference.

**Item 14. *Changes in and Disagreements with Accountants on Accounting and Financial Disclosure***

None.

**Item 15. *Financial Statements and Exhibits***

&nbsp;&nbsp;&nbsp;&nbsp;**a.**  ***Financial Statements and Exhibits*** 

The information required by this item is contained under the section "Index to Consolidated Financial Statements" and the financial statements referenced therein beginning on page F-1 of the Information Statement. This section is incorporated herein by reference.

 ****

&nbsp;&nbsp;&nbsp;&nbsp;***b.***  ***Exhibits.*** 

The following documents are filed as exhibits hereto:

---

| | |
|:---|:---|
| **Exhibit** | **Description** |
| 2.1 | [Form of Separation and Distribution Agreement between ABVC BioPharma, Inc., and the Registrant†](ea029154601ex2-1.htm) |
| 3.1 | [Form of Certificate of Incorporation of BioKey (Cayman), Inc.](ea029154601ex3-1.htm) |
| 3.2 | [Form of Memorandum and Articles of Association of BioKey (Cayman), Inc.](ea029154601ex3-2.htm) |
| 10.1 | [Form of Transition Services Agreement between ABVC BioPharma, Inc., and the Registrant](ea029154601ex10-1.htm) |
| 10.2 | [Form of Tax Matters Agreement between ABVC BioPharma, Inc., and the Registrant](ea029154601ex10-2.htm) |
| 10.3 | [Form of Employee Matters Agreement between ABVC BioPharma, Inc., and the Registrant](ea029154601ex10-3.htm) |
| 10.4 | [Form of Indemnification Agreements for Directors and Officers of the Registrant](ea029154601ex10-4.htm) |
| 10.5 | [Form of 2026 Equity Incentive Plan of Registrant](ea029154601ex10-5.htm) |
| 10.6 | [Share Transfer Agreement by and between BioKey (Cayman), Inc. and ABVC BioPharma, Inc., dated May 10, 2025](ea029154601ex10-6.htm) |
| 10.7 | [Supply and Distribution Agreement by and between Biokey, Inc. and Define Biotech Co., Ltd., dated December 6, 2021](ea029154601ex10-7.htm) |
| 21.1 | [List of Subsidiaries](ea029154601ex21-1.htm) |
| 99.1 | [Information Statement of BioKey (Cayman), Inc., preliminary and subject to completion, dated May 27, 2026.](ea029154601ex99-1.htm) |

---

&nbsp;&nbsp;&nbsp;&nbsp;† Pursuant to Item 601(b)(2) of Regulation S-K, certain schedules and similar attachments to the Separation Agreement have been omitted. BioKey (Cayman), Inc. hereby agrees to furnish supplementally a copy of any omitted schedule or similar attachment to the U.S. Securities and Exchange Commission upon request.

**SIGNATURES** 

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| **BioKey (Cayman), Inc.** | **BioKey (Cayman), Inc.** |
| By: | /s/ T.S. Jiang |
| Name: | T.S. Jiang |
| Title: | Chief Executive Officer |

---

Dated: May 27, 2026

## Exhibit 2.1

**Exhibit 2.1**

**SEPARATION AND DISTRIBUTION AGREEMENT**

THIS SEPARATION AND DISTRIBUTION AGREEMENT (the "**Agreement**") is made and entered into as of the [ ] day of [ ] 2026, by and between ABVC BioPharma, Inc., a Nevada corporation ("**Parent**"), and BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability and wholly owned subsidiary of Parent ("**Subsidiary**") (each, a "**Party**," and collectively, the "**Parties**").

**R E C I T A L S**

**WHEREAS**, the Board of Directors of Parent has determined that it is in the best interests of Parent and its shareholders to separate the business of the Subsidiary from that of the Parent through a spin-off transaction in which Parent will distribute a portion of its equity interest in Subsidiary while retaining a controlling interest therein (the "**Separation**");

**WHEREAS**, in order to effect the Separation, the Board of Directors of Parent has determined that it is in the best interests of Parent and its shareholders to distribute to Parent's shareholders, on a pro rata basis on terms contained in this Agreement, 10% of the Subsidiary's ordinary shares, par value $[ ] per share (the "**Ordinary Shares**") held by the Parent (the "**Distribution**");

**WHEREAS**, following the Distribution, Parent will continue to own the remaining 90% of the Ordinary Shares; and

**WHEREAS**, the Parties intend to set forth the principal corporate arrangements between the Parties with respect to the Separation and the Distribution in this Agreement.

**NOW, THEREFORE**, in consideration of the foregoing and the terms, conditions, covenants, and provisions of this Agreement, the Parties agree as follows:

**ARTICLE 1**

**DEFINITIONS**

<u>Section 1.1.</u>

<u>General</u>. As used in this Agreement, the following capitalized terms shall have the following meanings:

"<u>Action</u>" means any demand, action, suit, countersuit, arbitration, inquiry, proceeding or investigation by or before any federal, state, local, foreign, or international Governmental Authority or any arbitration or mediation tribunal.

"<u>Affiliate</u>" means, when used with respect to a specified Person, a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such specified Person, including, without limitation, a General Subsidiary (as defined below). As used herein, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or other interests, by contract or otherwise.

"<u>Agent</u>" shall have the meaning set forth in <u>Section 3.2(a)</u>.

"<u>Ancillary Agreements</u>" means this Agreement, the Transition Services Agreement, Tax Matters Agreement, Indemnification Agreements, the Employee Matters Agreement, all of which are related to the SpinOff (as hereinafter defined) and that the Parties are entering into on this same date, and all of the agreements, instruments, assignments or other arrangements entered into in connection with the transactions contemplated hereby.

"<u>Assets</u>" means assets, properties, claims and rights (including goodwill), wherever located (including in the possession of vendors or other Third Parties or elsewhere on behalf of the owner), of every kind, character and description, whether real, personal or mixed, tangible, intangible or contingent, in each case whether or not recorded or reflected or required to be recorded or reflected on the records or financial statements of any Person.

"<u>Combined Books and Records</u>" shall have the meaning set forth in <u>Section 5.1(c)</u>.

"<u>Commission</u>" means the United States Securities and Exchange Commission or any successor agency thereto.

"<u>Consents</u>" means any consents, waivers, or approvals from, or notification requirements to any Third Parties.

"<u>Contract</u>" means any contract, obligation, indenture, agreement, lease, purchase order, commitment, permit, license, note, bond, mortgage, arrangement or undertaking (whether written or oral and whether express or implied) that is legally binding on any Person or any part of its property under applicable Law, but excluding this Agreement and any Ancillary Agreement save as otherwise expressly provided in this Agreement or any Ancillary Agreement.

"<u>Distribution</u>" shall have the meaning set forth in the recitals hereto.

"<u>Distribution Date</u>" means the date upon which the Distribution shall be effective, as determined by the Board of Directors of Parent.

"<u>Effective Time</u>" means 11:59 p.m. Eastern Daylight Time on the Distribution Date at which time the Distribution is effective.

"<u>Exchange Act</u>" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time that reference is made thereto.

"<u>Form 10</u>" means the registration statement on Form 10 under the Exchange Act filed by Subsidiary with the Commission relating to the Ordinary Shares, as amended from time to time.

"<u>General Subsidiary</u>" means any corporation or other organization of which at least a majority of the securities or interests have voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by a Person.

"<u>Governmental Approvals</u>" means any notices, reports, or other filings to be made, or any consents, registrations, approvals, permits or authorizations to be obtained from, any Governmental Authority.

"<u>Governmental Authority</u>" means any federal, state, local, foreign, or international court, government department, commission, board, bureau, agency, official or other regulatory, administrative, or governmental authority.

"<u>Indemnifying Party</u>" shall have the meaning set forth in <u>Section 4.5(c)</u>.

"<u>Indemnitee</u>" shall have the meaning set forth in <u>Section 4.5(c)</u>.

"<u>Information</u>" means information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including without limitation, studies, reports, records, books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs or other software, marketing plans, customer names, communications by or to attorneys (including attorney-client privileged communications), memos and other materials prepared by attorneys or under their direction (including attorney work product), communications and materials otherwise related to or made or prepared in connection with or in preparation for any legal proceeding, and other technical, financial, employee or business information or data.

"<u>Intellectual Property</u>" means all intellectual property and industrial property rights of any kind or nature, including all United States and foreign (i) patents, patent applications, patent disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, substitutions and extensions thereof, (ii) trademarks and all goodwill associated therewith, (iii) copyrights and copyrightable subject matter, whether statutory or common law, registered or unregistered and published or unpublished, (iv) rights of publicity, (v) moral rights and rights of attribution and integrity, (vi) rights in Software, (vii) trade secrets and all other confidential and proprietary information, know-how, inventions, improvements, processes, formulae, models and methodologies, (viii) rights to personal information, (ix) telephone numbers and internet protocol addresses, (x) applications and registrations for the foregoing, and (xi) rights and remedies against past, present, and future infringement, misappropriation, or other violation of the foregoing.

"<u>Law</u>" means any federal, national, state, provincial, local, or similar statute, law, ordinance, regulation, rule, code, order, requirement, or rule of law (including common law).

"<u>Liabilities</u>" means any and all debts, liabilities, and obligations, whether accrued or fixed, known or unknown, absolute or contingent, matured or unmatured, reserved or unreserved of any kind or nature whatsoever.

"<u>Operations Data</u>" shall have the meaning set forth in <u>Section 5.2</u>.

"<u>Parent Books and Records</u>" shall have the meaning set forth in <u>Section 5.1(b)</u>.

"<u>Parent Business</u>" means all of the business and operations of Parent and its General Subsidiaries, other than the Subsidiary Business.

"<u>Parent Common Stock</u>" means the Common Stock, $0.001 par value per share, of Parent.

"<u>Parent Liabilities</u>" means any and all Liabilities of Parent and its Affiliates (other than Subsidiary and its Affiliates) to the extent relating to, arising out of or resulting from the Parent Business or any acts or omissions of Parent or its Affiliates (other than Subsidiary and its Affiliates).

"<u>Party</u>" shall have the meaning set forth in the preamble hereof.

"<u>Person</u>" means any natural person, firm, individual, corporation, business trust, joint venture, association, company, limited liability company, partnership or other organization or entity, whether incorporated or unincorporated, or any governmental entity.

"<u>Record Date</u>" means the close of business on [ ], 2026, the date determined by the Parent Board of Directors as the record date for the Distribution.

"<u>Separation</u>" shall have the meaning set forth in the recitals hereto.

"<u>Software</u>" means all computer programs (whether in source code, object code or other form), algorithms, databases and data, and technology supporting the foregoing, and all documentation, including flowcharts and other logic and design diagrams, technical, functional, and other specifications, and user manuals and training materials related to any of the foregoing.

"<u>Subsidiary Assets</u>" means (a) any and all Assets expressly set forth on <u>Schedule 2.1(a)</u> hereto under the caption "Subsidiary Assets," (b) any and all Assets reflected in the Subsidiary Balance Sheet, and any and all Intellectual Property used primarily in the Subsidiary Business, which have not been disposed of or removed from the Subsidiary Balance Sheet between the date of the Subsidiary Balance Sheet and the Distribution Date, and (c) any and all Assets acquired by Subsidiary (or Parent on behalf of Subsidiary) after the date of the Subsidiary Balance Sheet that would be reflected in the balance sheet of Subsidiary as of the Distribution Date, if such balance sheet was prepared by Subsidiary in accordance with the same accounting principles under which the Subsidiary Balance Sheet was prepared.

"<u>Subsidiary Balance Sheet</u>" means the unaudited balance sheet of Subsidiary as of [ ], 2026 included in the Form 10 and attached hereto as <u>Schedule 1.1(a)</u>.

"<u>Subsidiary Books and Records</u>" shall have the meaning set forth in <u>Section 5.1(a)</u>.

"<u>Subsidiary Business</u>" means all of the business and operations of the Subsidiary as described in the Form 10.

"<u>Third Party</u>" means any Person other than Parent, Subsidiary or Affiliate thereof.

"<u>Third Party Claim</u>" shall have the meaning set forth in <u>Section 4.5(c)</u>.

"<u>Transfer</u>" shall have the meaning set forth in <u>Section 2.1(a)</u>.

<u>Section 1.2.</u>

<u>References; Interpretation</u>. References in this Agreement to the singular shall include the plural and vice versa and words of one gender shall include the other gender as the context requires. The terms "hereof," "herein," and "herewith" and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole (including all of the Schedules and Exhibits hereto) and not to any particular provision of this Agreement. Article, Section, Exhibit and Schedule references are to the Articles, Sections, Exhibits and Schedules to this Agreement unless otherwise specified. The word "including" and words of similar import when used in this Agreement (or the applicable Ancillary Agreement) means "including, without limitation," unless the context otherwise requires or unless otherwise specified. The word "or" shall not be exclusive.

**ARTICLE 2**

**THE SEPARATION**

<u>Section 2.1.</u>

<u>Subsidiary Assets</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) As
 of the date hereof, and immediately prior to the Effective Time, Subsidiary shall retain
 all Subsidiary Assets, as defined in Section 1.1 above. Subsidiary Assets shall include,
 but not be limited to, those assets set forth in Schedule 2.1(a) attached hereto and by this
 reference made a part hereof. To the extent any of the Subsidiary Assets are currently held
 in the name of Parent, as of the date hereof, and immediately prior to the Effective Time,
 Parent hereby transfers, contributes, assigns, distributes and conveys to Subsidiary all
 of Parent's right, title, and interest, if any, in and to the Subsidiary Assets (the
 "**Transfer,**" together with the Separation and Distribution, the "**SpinOff** ").
 Subsidiary hereby accepts any such Transfer from Parent, effective concurrently therewith.

&nbsp;&nbsp;&nbsp;&nbsp;b) If
 at any time (whether prior to or after the Effective Time) either Party hereto shall receive
 or otherwise possess an Asset that is allocated to any other Person pursuant to this Agreement
 or any Ancillary Agreement, such Party shall promptly transfer or cause to be transferred,
 at such Party's expense, for no additional consideration, such Asset, including any
 and all economic benefits generated from such Asset after the Effective Time, to such Party
 hereto.

&nbsp;&nbsp;&nbsp;&nbsp;c) In
 furtherance of the Transfer, and simultaneously with the execution and delivery of this Agreement,
 Parent shall execute and deliver, and shall cause its Affiliates to execute and deliver,
 such bills of sale, stock powers, certificates of title, assignments of contracts and other
 instruments of transfer, conveyance, and assignment as and to the extent necessary to evidence
 the Transfer.

<u>Section 2.2.</u>

<u>(Reserved)</u>.

<u>Section 2.3.</u>

<u>Governmental Approvals; Waivers or Consents</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) To
 the extent that the Separation requires any Governmental Approvals, Waivers, or Consents,
 the Parties shall use commercially reasonable efforts to obtain any such Governmental Approvals,
 Waivers, or Consents prior to the Separation and Distribution, as applicable. No Party shall
 be obligated to pay any consideration to any Third Party from whom any such Waiver or Consent
 is requested.

&nbsp;&nbsp;&nbsp;&nbsp;b) If
 the transfer of any Subsidiary Assets intended to be transferred hereunder is not consummated
 prior to the Effective Time for any reason, then Parent shall thereafter hold such Subsidiary
 Asset for the use and benefit of Subsidiary if permitted by law. If and when the Governmental
 Approvals, Consents, Waivers, or other impediments to transfer, that caused the deferral
 of transfer of such Asset are obtained or removed, the transfer of the applicable Asset shall
 be effected in accordance with the terms of this Agreement and/or the applicable Ancillary
 Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;c) If
 the Parties are unable to obtain any required Governmental Approvals, Waivers, or Consents,
 Parent shall continue to be bound by such Contract, license, or other obligation; provided,
 however, that Parent shall not be obligated to extend, renew or otherwise cause such Contract,
 license or other obligation to remain in effect beyond the term in effect as of the Effective
 Time. If and when any such Governmental Approval, Consent or Waiver is obtained or such agreement,
 lease, license or other rights or obligations shall otherwise become assignable or capable
 of novation, Parent shall promptly assign, or cause to be assigned, all rights, obligations
 and other Liabilities thereunder to Subsidiary without payment of any further consideration
 and Subsidiary, without the payment of any further consideration, shall assume such rights
 and obligations and other Liabilities.

<u>Section 2.4.</u>

<u>(Reserved)</u>.

<u>Section 2.5.</u>

<u>Disclaimer of Representations and Warranties</u>. ON BEHALF OF THE PARTIES, THE PARTIES UNDERSTAND AND AGREE THAT, EXCEPT AS EXPRESSLY SET FORTH HEREIN OR IN ANY ANCILLARY AGREEMENT, NO PARTY TO THIS AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT CONTEMPLATED BY THIS AGREEMENT, IS REPRESENTING OR WARRANTING IN ANY WAY AS TO THE ASSETS, BUSINESSES OR LIABILITIES CONTRIBUTED, TRANSFERRED, DISTRIBUTED OR ASSUMED HEREBY OR THEREBY, AS TO ANY CONSENTS, WAIVERS, OR GOVERNMENTAL APPROVALS REQUIRED IN CONNECTION HEREWITH OR THEREWITH, AS TO THE VALUE OR FREEDOM FROM ANY SECURITY INTERESTS OF, OR ANY OTHER MATTER CONCERNING, ANY ASSETS OF SUCH PARTY, OR AS TO THE ABSENCE OF ANY DEFENSES OR RIGHT OF SETOFF OR FREEDOM FROM COUNTERCLAIM WITH RESPECT TO ANY CLAIM OR OTHER ASSET OF ANY PARTY, OR AS TO THE LEGAL SUFFICIENCY OF ANY CONTRIBUTION, DISTRIBUTION, ASSIGNMENT, DOCUMENT, CERTIFICATE OR INSTRUMENT DELIVERED HEREUNDER TO CONVEY TITLE TO ANY ASSET OR THING OF VALUE UPON THE EXECUTION, DELIVERY AND FILING HEREOF OR THEREOF. EXCEPT AS MAY EXPRESSLY BE SET FORTH HEREIN OR IN ANY ANCILLARY AGREEMENT, ALL SUCH ASSETS ARE BEING TRANSFERRED ON AN "AS IS," "WHERE IS" BASIS AND, THE SUBSIDIARY SHALL BEAR THE ECONOMIC AND LEGAL RISKS THAT (I) ANY CONVEYANCE SHALL PROVE TO BE INSUFFICIENT TO VEST IN THE SUBSIDIARY GOOD AND MARKETABLE TITLE, FREE AND CLEAR OF ANY SECURITY INTEREST, AND (II) ANY NECESSARY CONSENTS, WAIVERS, OR GOVERNMENTAL APPROVALS ARE NOT OBTAINED OR THAT THE REQUIREMENTS OF LAWS, CONTRACTS, OR JUDGMENTS ARE NOT COMPLIED WITH.

**ARTICLE 3**

**THE DISTRIBUTION**

<u>Section 3.1.</u>

<u>The Distribution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) Subject
 to <u>Section 3.2</u>, on or prior to the Distribution Date, for the benefit of and distribution
 to the holders of Parent Common Stock on the Record Date, Parent will deliver stock certificates,
 endorsed by Parent in blank, to the distribution agent, VStock Transfer, LLC (the "**Agent** "),
 representing the equivalent of 10% of Subsidiary's outstanding Ordinary Shares on such
 date. Parent shall instruct the Agent to distribute in electronic or certificated form the
 appropriate number of such Ordinary Shares to each such holder or designated transferee or
 transferees of such holder.

&nbsp;&nbsp;&nbsp;&nbsp;b) Subject
 to <u>Section 3.</u> 2, each holder of Parent Common Stock on the Record Date (or such holder's
 designated transferee or transferees) will be entitled to receive in the Distribution as
 of the Effective Time [ ] Ordinary Shares for each share of Parent Common Stock held of record
 on the Record Date. No fractional shares will be issued. In the event a holder of Parent
 Common Stock would otherwise be entitled to a fractional Ordinary Share of Subsidiary, the
 number of Ordinary Shares such holder of Parent Common Stock will receive in the Distribution
 will be rounded up to the nearest whole number of Ordinary Shares. No action by any such
 shareholder shall be necessary for such shareholder (or such shareholder's designated
 transferee or transferees) to receive the Ordinary Shares. Subsidiary and Parent will provide
 to the Agent any and all information required in order to complete the Distribution.

<u>Section 3.2.</u>

<u>Actions in Connection with the Distribution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) Prior
 to the Distribution Date, Parent and Subsidiary shall have prepared and informed the holders
 of Parent Common Stock such information concerning Subsidiary, the Subsidiary Business, operations
 and management, the Distribution, the Separation, and such other matters as Parent shall
 reasonably determine and as may be required by law.

&nbsp;&nbsp;&nbsp;&nbsp;b) Subsidiary
 shall have prepared and, in accordance with applicable Law, filed with the Commission the
 Form 10, including amendments, supplements and any such other documentation which is necessary
 or desirable to effectuate the Distribution, and Subsidiary shall have obtained all necessary
 approvals from the Commission with respect thereto as soon as practicable.

&nbsp;&nbsp;&nbsp;&nbsp;c) Parent
 and Subsidiary shall take all such action as may be necessary or appropriate under the securities
 or blue sky laws of the states or other political subdivisions of the United States or of
 other foreign jurisdictions in connection with the Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;d) Following
 the Separation, Subsidiary and/or its market makers will prepare and file an application
 for the original listing or quotation on the OTC Bulletin Board, and/or the OTC Markets Group,
 Inc., of the Ordinary Shares.

&nbsp;&nbsp;&nbsp;&nbsp;e) Parent
 and Subsidiary shall take all reasonable steps necessary to cause the conditions set forth
 in <u>Section 3.3</u> to be satisfied and to effect the Distribution on the Distribution
 Date.

<u>Section 3.3.</u>

<u>Conditions to the SpinOff</u>. Subject to <u>Section 3.2</u>, the following are conditions to the consummation of the SpinOff. The conditions are for the sole benefit of Parent and shall not give rise to or create any duty on the part of Parent or the Board of Directors of Parent to waive or not waive any such condition:

&nbsp;&nbsp;&nbsp;&nbsp;a) The
 Form 10 shall have been filed with the Commission for the purpose of registering the Ordinary
 Shares under the Exchange Act, with no stop order in effect with respect thereto and Subsidiary
 shall have cleared all Commission comments related to the Form 10.

&nbsp;&nbsp;&nbsp;&nbsp;b) An
 information statement satisfying the requirements of Commission shall have been filed with
 the Commission and delivered to all holders of Parent Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;c) All
 Government Approvals and other Consents necessary to consummate the SpinOff shall have been
 obtained and be in full force and effect, except for any such Government Approvals or Consents
 the failure of which to obtain would not have material adverse effect on the business, operations,
 or condition (financial or otherwise) of either Parent or Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;d) No
 order, injunction or decree issued by any court or agency of competent jurisdiction preventing
 the consummation of the SpinOff shall be in effect and no other event outside the control
 of Parent shall have occurred or failed to occur that prevents the consummation of the SpinOff.

&nbsp;&nbsp;&nbsp;&nbsp;e) The
 Board of Directors of Parent shall have authorized and approved the SpinOff and not withdrawn
 such authorization and approval.

&nbsp;&nbsp;&nbsp;&nbsp;f) No
 other events or developments shall have occurred that, in the sole discretion of the Board
 of Directors of Parent, would result in the SpinOff having a material adverse effect on Parent,
 its shareholders or its creditors, or not being in the best interest of Parent, its shareholders
 and creditors.

&nbsp;&nbsp;&nbsp;&nbsp;g) The
 Ancillary Agreements shall have been executed by each party to those agreements.

**ARTICLE 4**

**COVENANTS**

<u>Section 4.1.</u>

<u>Post Closing Cooperation</u>. Following the SpinOff, Parent and Subsidiary shall cooperate with respect to access to data relevant to their respective businesses.

<u>Section 4.2.</u>

<u>Conduct of Business</u>. From the date of this Agreement until the earlier of the Effective Time or the termination of this Agreement in accordance with its terms (the "**Interim Period**"), the Subsidiary shall, except as expressly contemplated by this Agreement, as consented to in writing by Parent (which consent shall not be unreasonably conditioned, withheld or delayed) or as required by applicable law, conduct and operate its business in the ordinary course of business in all material respects. Without limiting the generality of the foregoing, during the Interim Period, except as contemplated by this Agreement or any Ancillary Agreement or as disclosed in the Schedules, as consented to by Parent in writing (such consent not to be unreasonably conditioned, withheld or delayed), or as required by applicable law, Subsidiary shall:

&nbsp;&nbsp;&nbsp;&nbsp;a) preserve
 and protect the Subsidiary Assets in the ordinary course of business consistent with past
 practice;

&nbsp;&nbsp;&nbsp;&nbsp;b) not
 sell, transfer, assign, license, pledge, encumber, or otherwise dispose of any of the Subsidiary
 Assets without Parent's prior written consent;

&nbsp;&nbsp;&nbsp;&nbsp;c) not
 take any action that would cause any of the representations and warranties of Subsidiary
 contained in this Agreement to be untrue or inaccurate in any material respect;

&nbsp;&nbsp;&nbsp;&nbsp;d) promptly
 notify Parent in writing of any event, occurrence, or circumstance that would reasonably
 be expected to have a material adverse effect on the business, operations, or condition (financial
 or otherwise) of Subsidiary;

&nbsp;&nbsp;&nbsp;&nbsp;e) provide
 Parent with reasonable access to the Subsidiary Assets, books, records, and personnel of
 Subsidiary during normal business hours upon reasonable advance notice; and

&nbsp;&nbsp;&nbsp;&nbsp;f) use
 commercially reasonable efforts to satisfy all conditions to the SpinOff set forth in Section
 3.3.

<u>Section 4.3.</u>

<u>Confidentiality</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) Notwithstanding
 any termination of this Agreement and subject to <u>Section 4.3(c)</u>, for a period of two
 (2) years from the Distribution Date, each Party agrees to hold, and to cause its respective
 Affiliates, directors, officers, employees, agents, accountants, counsel and other advisors
 and representatives to hold, in strict confidence, and undertake all reasonable precautions
 to safeguard and protect the confidentiality of, all Information concerning the other Party
 that is in its possession after the Distribution Date or furnished by the other Party or
 its respective directors, officers, employees, agents, accountants, counsel and other advisors
 and representatives at any time pursuant to this Agreement, any Ancillary Agreement or otherwise,
 and shall not use any such Information other than for such purposes as shall be expressly
 permitted hereunder or thereunder, except, in each case, to the extent that such Information
 has been (i) in the public domain through no fault of such Party or any of their respective
 directors, officers, employees, agents, accountants, counsel and other advisors and representatives,
 (ii) lawfully acquired from other sources, which are not bound by a confidentiality obligation,
 by such Party, or (iii) independently generated without reference to any proprietary or confidential
 Information of the other Party. Notwithstanding the foregoing, nothing in this Section 4.3
 shall restrict or limit Parent's right, in its capacity as the holder of [ ]% of the
 outstanding Ordinary Shares, to receive, access, or use Information of Subsidiary to the
 extent reasonably necessary for Parent's financial reporting, tax compliance, consolidation,
 corporate governance, regulatory compliance, or other legitimate purposes arising from Parent's
 ownership interest in Subsidiary, in each case subject to applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;b) Each
 Party agrees not to release or disclose, or permit to be released or disclosed, any such
 Information to any other Person, except its directors, officers, employees, agents, accountants,
 counsel and other advisors and representatives who need to know such Information and who
 are informed and advised that the Information is confidential and subject to the obligations
 hereunder, except in compliance with <u>Section 4.3(c)</u>. Without limiting the foregoing,
 when any Information is no longer needed for the purposes contemplated by this Agreement
 or any Ancillary Agreement, each Party will promptly after request of the other Party either
 (i) destroy all copies of the Information in such Party's possession, custody or control
 (including any that may be stored in any computer, word processor, or similar device, to
 the extent not commercially impractical to destroy such copies) including, without limitation,
 any copies, summaries, analyses, reports, extracts or other reproductions, in whole or in
 part, of such written, electronic or other tangible material or any other materials in written,
 electronic or other tangible format based on, reflecting or containing Information prepared
 by such Party, and/or (ii) return to the requesting Party, at the expense of the requesting
 Party, all copies of the Information furnished to such Party by or on behalf of the requesting
 Party; provided, however, that the foregoing destruction and return obligations shall not
 apply to Information that Parent reasonably requires in its capacity as the holder of 90%
 of the outstanding Ordinary Shares for purposes of financial reporting, tax compliance, consolidation,
 corporate governance, or regulatory compliance.

&nbsp;&nbsp;&nbsp;&nbsp;c) In
 the event that either Party (i) determines after consultation with counsel, in the opinion
 of such counsel that it is required by law to disclose any Information or (ii) receives any
 demand under lawful process or from any Governmental Authority to disclose or provide Information
 of the other Party that is subject to the confidentiality provisions hereof, such Party shall
 notify the other Party prior to disclosing or providing such Information and shall cooperate
 at the expense of the requesting party (and to the extent legally permissible) in seeking
 any reasonable protective arrangements requested by such other Party. Subject to the foregoing,
 the Party that received such request may thereafter (1) furnish only that portion of the
 confidential Information that is legally required, (2) give notice to the other Party of
 the information to be disclosed as far in advance as is practical, and (3) exercise reasonable
 best efforts to obtain reliable assurance that the confidential nature of such Information
 shall be maintained.

<u>Section 4.4.</u>

<u>Litigation cooperation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) Each
 of Parent and Subsidiary agrees that at all times from and after the Effective Time, if an
 Action currently exists or is commenced by a third-party with respect to which a Party is
 a named defendant but such Action is otherwise not a Liability allocated to such named Party
 under this Agreement or any Ancillary Agreement, then the other Party shall use commercially
 reasonable efforts to cause such named but not liable defendant to be removed from such Action
 and such defendant shall not be required to make any payments or contribution in connection
 therewith.

&nbsp;&nbsp;&nbsp;&nbsp;b) Each
 of Parent and Subsidiary shall each use commercially reasonable efforts to make available
 to the other, upon written request, its officers, directors, employees and agents, and the
 officers, directors, employees, and agents thereof, as witnesses to the extent that such
 individuals may reasonably be required in connection with any legal, administrative, or other
 proceedings in which the requesting Party may be involved. The requesting Party shall bear
 all out-of-pocket expenses in connection therewith. On and after the Effective Time, in connection
 with any matter contemplated by this <u>Section 4.4</u>, the Parties will maintain any attorney-client
 privilege or work product immunity of each Party as required by this Agreement or any Ancillary
 Agreement.

<u>Section 4.5.</u>

<u>Indemnification</u>

&nbsp;&nbsp;&nbsp;&nbsp;a) Except
 as otherwise provided in this Agreement or any Ancillary Agreement, following the Distribution
 Date and for a period of one (1) year thereafter, Subsidiary shall indemnify, defend and
 hold harmless Parent and its Affiliates, including each of their respective directors and
 officers, and each of the heirs, executors, successors and assigns of any of the foregoing
 (collectively, the "**Parent Indemnitees** "), from and against any and all
 Liabilities and related losses of the Parent Indemnitees relating to, arising out of or resulting
 from any of (a) the failure of Subsidiary or its Affiliates or any other Person to pay, perform
 or otherwise promptly discharge after the Distribution Date any Subsidiary Liabilities incurred
 after the Distribution in accordance with their respective terms, (b) any untrue statement,
 alleged untrue statement, omission or alleged omission of a material fact in the Form 10,
 resulting in a misleading statement, with respect to all information contained in the Form
 10, (c) any Liability or loss arising from fraud, an intentional misrepresentation, gross
 negligence or willful misconduct by the Subsidiary in this Agreement or in any schedule,
 exhibit, certificate, financial statement, agreement or other instrument delivered under
 or in connection with this Agreement, and (d) any breach by Subsidiary of this Agreement
 or any of the Ancillary Agreements; provided, however, that no claim for indemnification
 under this Section 4.5(a) may be asserted after the date that is one (1) year following the
 Distribution Date. The Parties acknowledge that, as of the Distribution Date, Parent will
 hold [ ]% of the outstanding Ordinary Shares, and accordingly, any indemnification payment
 made by Subsidiary to any Parent Indemnitee pursuant to this Section 4.5(a) shall be borne
 economically by Subsidiary's shareholders (including Parent) in proportion to their
 respective ownership interests.

&nbsp;&nbsp;&nbsp;&nbsp;b) Except
 as otherwise provided in this Agreement or any Ancillary Agreement, following the Distribution
 Date and for a period of one (1) year thereafter, Parent shall indemnify, defend and hold
 harmless Subsidiary, and its Affiliates, including each of their respective directors and
 officers, and each of the heirs, executors, successors and assigns of any of the foregoing
 (collectively, the "**Subsidiary Indemnitees** "), from and against any and
 all Liabilities and related losses of the Subsidiary Indemnitees relating to, arising out
 of or resulting from any of (a) the failure of Parent or its Affiliates to pay, perform or
 otherwise promptly discharge after the Distribution Date any Parent Liabilities arising from
 acts, omissions, or events occurring prior to the Effective Time, (b) the Parent Liabilities,
 solely to the extent arising from acts, omissions, or events occurring prior to the Effective
 Time, (c) any breach by Parent of this Agreement or any of the Ancillary Agreements, and
 (d) any Liabilities and related losses incurred by Subsidiary or its minority shareholders
 arising from Parent's exercise of its rights as the holder of [ ]% of the outstanding
 Ordinary Shares in a manner that constitutes fraud, willful misconduct, gross negligence,
 or a breach of any fiduciary duty owed by Parent to Subsidiary or its minority shareholders
 under applicable Law; provided, however, that no claim for indemnification under this Section
 4.5(b) may be asserted after the date that is one (1) year following the Distribution Date,
 except that claims arising under clause (d) of this Section 4.5(b) may be asserted at any
 time during the period in which Parent holds a majority of the outstanding Ordinary Shares.

&nbsp;&nbsp;&nbsp;&nbsp;c) If
 a party entitled to indemnification hereunder (an "**Indemnitee**") shall
 receive notice or otherwise learn of the assertion by a Third Party (including any Governmental
 Authority) of any claim or of the commencement by any such Person of any Action (collectively,
 a "**Third Party Claim**") with respect to which a party required to provide
 indemnification hereunder (an "**Indemnifying Party**") may be obligated to
 provide indemnification to such Indemnitee, such Indemnitee shall give such Indemnifying
 Party and each Party to this Agreement written notice thereof as soon as reasonably practicable,
 but no later than thirty (30) days after becoming aware of such Third Party Claim. Any such
 notice shall describe the Third Party Claim in reasonable detail. If any Party shall receive
 notice or otherwise learn of the assertion of a Third Party Claim which may reasonably be
 determined to be a Liability of the Parties, such Party shall give the other Party to this
 Agreement written notice thereof within thirty (30) days after becoming aware of such Third
 Party Claim. Any such notice shall describe the Third Party Claim in reasonable detail. Notwithstanding
 the foregoing, the failure of any Indemnitee or other Party to give notice as provided in
 this <u>Section 4.5(c)</u> shall not relieve the related Indemnifying Party of its obligations
 under this <u>ARTICLE 4</u>, except to the extent that such Indemnifying Party is prejudiced
 by such failure to give notice.<br>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) An
 Indemnifying Party shall be entitled to participate in the defense of any Third Party Claim,
 at such Indemnifying Party's own expense and by such Indemnifying Party's own
 counsel; provided that if the defendants in any such claim include both the Indemnifying
 Party and one or more Indemnitees and in such Indemnitees' reasonable judgment a conflict
 of interest between such Indemnitees and such Indemnifying Party exists in respect of such
 claim, such Indemnitees shall have the right to employ separate counsel and in that event
 the reasonable fees and expenses of such separate counsel (but not more than one separate
 counsel reasonably satisfactory to the Indemnifying Party) shall be paid by such Indemnifying
 Party. Within thirty (30) days after the receipt of notice from an Indemnitee in accordance
 with <u>Section 4.5</u> (or sooner, if the nature of such Third Party Claim so requires),
 the Indemnifying Party shall notify the Indemnitee of its election whether the Indemnifying
 Party will assume responsibility for defending such Third Party Claim. After notice from
 an Indemnifying Party to an Indemnitee of its election to assume the defense of a Third Party
 Claim, such Indemnitee shall have the right to employ separate counsel and to participate
 in (but not control) the defense, compromise or settlement thereof, but the fees and expenses
 of such counsel shall be the expense of such Indemnitee.

ii) With respect to any Third Party Claim, the Indemnifying Party and Indemnitees agree, and shall cause their respective counsel (if applicable), to cooperate fully (in a manner that will preserve all attorney-client privilege or other privileges) to mitigate any such claim and minimize the defense costs associated therewith.

iii) If an Indemnifying Party fails to assume the defense of a Third Party Claim within thirty (30) days after receipt of written notice of such claim, the Indemnitee will, upon delivering notice to such effect to the Indemnifying Party, have the right to undertake the defense, compromise or settlement of such Third Party Claim on behalf of and for the account of the Indemnifying Party subject to the limitations as set forth in this <u>Section 4.5(c)</u>; provided, however, that such Third Party Claim shall not be compromised or settled without the written consent of the Indemnifying Party, which consent shall not be unreasonably withheld, delayed or conditioned. If the Indemnitee assumes the defense of any Third Party Claim, it shall keep the Indemnifying Party reasonably informed of the progress of any such defense, compromise or settlement. The Indemnifying Party shall reimburse all such costs and expenses of the Indemnitee in the event it is ultimately determined that the Indemnifying Party is obligated to indemnify the Indemnitee with respect to such Third Party Claim. In no event shall an Indemnifying Party be liable for any settlement effected without its consent, which consent will not be unreasonably withheld, delayed, or conditioned.

&nbsp;&nbsp;&nbsp;&nbsp;d) Any
 claim on account of a Liability or related loss which does not result from a Third Party
 Claim shall be asserted by written notice given by the Indemnitee to the related Indemnifying
 Party. Such Indemnifying Party shall have a period of thirty (30) days after the receipt
 of such notice within which to respond thereto. If such Indemnifying Party does not respond
 within such thirty (30) day period, such Indemnifying Party shall be deemed to have accepted
 responsibility to make payment. If such Indemnifying Party rejects such claim in whole or
 in part, such Indemnitee shall be free to pursue such remedies as may be available to such
 party as contemplated by this Agreement and the Ancillary Agreements.

&nbsp;&nbsp;&nbsp;&nbsp;e) In
 the event of payment by or on behalf of any Indemnifying Party to any Indemnitee in connection
 with any Third Party Claim, such Indemnifying Party shall be subrogated to and shall stand
 in the place of such Indemnitee as to any events or circumstances in respect of which such
 Indemnitee may have any right, defense or claim relating to such Third Party Claim against
 any claimant or plaintiff asserting such Third Party Claim or against any other person. Such
 Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner, and at the
 cost and expense (including allocated costs of in-house counsel and other in-house personnel)
 of such Indemnifying Party, in prosecuting any subrogated right, defense or claim.

&nbsp;&nbsp;&nbsp;&nbsp;f) In
 the event of an Action in which the Indemnifying Party is not a named defendant, if the Indemnifying
 Party shall so request, the Parties shall endeavor to substitute the Indemnifying Party for
 the named defendant and add the Indemnifying Party as a named defendant if at all practicable.
 If such substitution or addition cannot be achieved for any reason or is not requested, the
 named defendant shall allow the Indemnifying Party to manage the Action as set forth in this
 section and subject to <u>Section 4.5</u> with respect to Liabilities, the Indemnifying Party
 shall fully indemnify the named defendant against all costs of defending the Action (including
 court costs, sanctions imposed by a court, attorneys' fees, experts' fees and
 all other external expenses, and the allocated costs of in-house counsel and other in-house
 personnel), the costs of any judgment or settlement, and the costs of any interest or penalties
 relating to any judgment or settlement.

&nbsp;&nbsp;&nbsp;&nbsp;g) The
 rights and obligations of each Party and their respective Indemnitees under this Section
 4.5 shall survive the Distribution Date for a period of one (1) year and shall terminate
 and be of no further force or effect upon the expiration of such one (1)-year period, except
 with respect to claims for indemnification that have been asserted in writing prior to the
 expiration of such period, which claims shall survive until final resolution thereof. In
 the event that Subsidiary or its successors or assigns consolidates with or merges into any
 other Person and shall not be the continuing or surviving company or entity of such consolidation
 or merger or transfers or conveys all or substantially all of its properties and assets (including
 but not limited to the Assets) to any Person during such one one-year period, then, and in
 each such case, Subsidiary shall ensure, and cause its subsidiaries to ensure, that proper
 provision shall be made so that the successors and assigns of Subsidiary shall succeed to
 the obligations set forth in this Section 4.5.

**ARTICLE 5**

**ACCESS TO INFORMATION AND SERVICES**

<u>Section 5.1.</u>

<u>Provision of Corporate Records</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) Except
 as otherwise provided in any Ancillary Agreement, upon the prior written request by Subsidiary
 for specific and identified books and records which relate to (x) Subsidiary or the conduct
 of the Subsidiary Business, as the case may be, up through the Distribution Date, or (y)
 any Ancillary Agreement to which Subsidiary and Parent are parties (the "**Subsidiary Books and Records** "), Parent shall, at the expense of Subsidiary, provide for the
 transport of the Subsidiary Books and Records in its possession or control to a location
 provided by Subsidiary as soon as practicable but no later than thirty (30) calendar days
 following the date of such request, except to the extent such items are already in the possession
 of Subsidiary or a Subsidiary Affiliate.

&nbsp;&nbsp;&nbsp;&nbsp;b) Except
 as otherwise provided in any Ancillary Agreement, upon the prior written request by Parent
 for specific and identified books and records which relate to (x) Parent or the conduct of
 the Parent Business, as the case may be, up through the Distribution Date, or (y) any Ancillary
 Agreement to which Subsidiary and Parent are parties (the "**Parent Books and Records** "),
 Subsidiary shall, at the expense of Parent, provide the transport of the Parent Books and
 Records in its possession or control to a location provided by Parent as soon as practicable
 but no later than thirty (30) calendar days following the date of such request, except to
 the extent such items are already in the possession of Parent or a Parent Affiliate.

&nbsp;&nbsp;&nbsp;&nbsp;c) With
 respect to books and records that relate to both the Subsidiary Business and the Parent Business
 (the "**Combined Books and Records** "), (i) the Parties shall use good faith
 efforts to divide such Combined Books and Records into Subsidiary Books and Records and Parent
 Books and Records, as appropriate, and (ii) to the extent such Combined Books and Records
 are not so divided, each Party shall each keep and maintain copies of such Combined Books
 and Records as reasonably appropriate under the circumstances, subject to applicable confidentiality
 provisions hereof and of any Ancillary Agreement.

<u>Section 5.2.</u>

<u>Access to Information</u>. Except as otherwise provided herein or in an Ancillary Agreement, from and after the Distribution Date, Parent shall provide Subsidiary and its authorized accountants, counsel and other designated representatives reasonable access and duplicating rights during normal business hours to all records, books, contracts, instruments, computer data and other data and information relating to pre-Distribution operations of the Subsidiary Business (collectively, "**Operations Data**") within Parent's possession or control (including using reasonable best efforts to give access to persons or firms possessing information) insofar as such access is reasonably required by Subsidiary for the conduct of the Subsidiary Business, subject to appropriate restrictions for classified or privileged information. Similarly, except as otherwise provided in an Ancillary Agreement, Subsidiary shall provide Parent and its authorized accountants, counsel and other designated representatives reasonable access (including using reasonable best efforts to give access to persons or firms possessing information) and duplicating rights during normal business hours to Operations Data, within Subsidiary's possession, insofar as such access is reasonably required by Parent for the conduct of the Parent Business, subject to appropriate restrictions for classified or privileged information. Operations Data and other documents may be requested under this <u>ARTICLE 5</u> for the legitimate business purposes of either Party, including, without limitation, audit, accounting, claims (including claims for indemnification hereunder), litigation and tax purposes, as well as for purposes of fulfilling disclosure and reporting obligations and for performing under this Agreement and the transactions contemplated hereby.

<u>Section 5.3.</u>

<u>Reimbursement</u>. Except to the extent otherwise contemplated in any Ancillary Agreement, a Party providing Operations Data or witness services to the other Party under this <u>ARTICLE 5</u> shall be entitled to receive from the recipient, upon the presentation of invoices therefor, payments of such amounts, relating to supplies, disbursements and other out-of-pocket expenses (at cost) and direct and indirect expenses of employees who are witnesses or otherwise furnish assistance (at cost), as may be reasonably incurred in providing such Operations Data or witness services.

**ARTICLE 6**

**FURTHER ASSURANCES**

<u>Section 6.1.</u>

<u>Further Assurances</u>. In addition to and without limiting the actions specifically provided in this Agreement, each of the Parties hereto shall use its reasonable best efforts, prior to, on and after the Distribution Date, to take, or cause to be taken, all actions, and to do, or cause to be done, all things reasonably necessary, proper or advisable under applicable laws, regulations and agreements to consummate and make effective the transactions contemplated by this Agreement and the Ancillary Agreements. Without limiting the foregoing, prior to, on and after the Distribution Date, each Party hereto shall cooperate with the other Party, and without any further consideration, but at the expense of the requesting Party, to execute and deliver, or use its reasonable best efforts to cause to be executed and delivered, all instruments, including instruments of conveyance, assignment and transfer, and to make all filings with, and to obtain all consents, approvals or authorizations of, any Governmental Authority or any other Person under any permit, license, agreement, indenture or other instrument (including any Consents or Governmental Approvals), and to take all such other actions as such Party may reasonably be requested to take by the other Party hereto from time to time, consistent with the terms of this Agreement and the Ancillary Agreements, in order to effectuate the provisions and purposes of this Agreement and the Ancillary Agreements and the transfers of the Subsidiary Assets and the other transactions contemplated hereby and thereby.

For the avoidance of doubt, nothing in this Section 6.1 or elsewhere in this Agreement shall be construed to require Parent to provide any ongoing operational, developmental, regulatory, scientific, or commercial services to Subsidiary following the Effective Time. The obligations of Parent under Article 5 and this Section 6.1 are solely ministerial and incidental to the consummation of the SpinOff and shall not be construed as consideration for, or a condition to the vesting or receipt of, the Securities or any portion thereof. Notwithstanding the foregoing, the Parties acknowledge that Parent will continue to hold [ ]% of the outstanding Ordinary Shares following the Effective Time, and nothing in this Agreement shall be construed to terminate or limit any rights, obligations, or duties arising from Parent's continuing ownership interest in Subsidiary, including without limitation Parent's obligations under Section 4.5 and Article 5, which shall survive the Effective Time in accordance with their respective terms.

**ARTICLE 7**

**TERMINATION**

<u>Section 7.1.</u>

<u>Termination</u>. Notwithstanding anything to the contrary herein, this Agreement may be terminated, and the Distribution may be amended, modified, or abandoned at any time prior to the Effective Time by and in the sole discretion of Parent without the approval of Subsidiary or the shareholders of Parent. In the event of such termination, no Party shall have any Liability to the other Party or any other Person. After the Effective Time, this Agreement may not be terminated except by an agreement in writing signed by each of the Parties.

**ARTICLE 8**

**MISCELLANEOUS**

<u>Section 8.1.</u>

<u>Counterparts; Entire Agreement</u>.

&nbsp;&nbsp;&nbsp;&nbsp;a) This
 Agreement and each Ancillary Agreement may be executed in separate counterparts, each such
 counterpart being deemed to be an original instrument, and which counterparts shall together
 constitute the same agreement.

&nbsp;&nbsp;&nbsp;&nbsp;b) This
 Agreement, the Ancillary Agreements and the Exhibits and Schedules hereto and thereto contain
 the entire agreement between the Parties with respect to the subject matter hereof, supersede
 all previous agreements, negotiations, discussions, writings, understandings, commitments
 and conversations with respect to such subject matter, and there are no agreements or understandings
 between the Parties other than those set forth or referred to herein or therein. Except with
 respect to tax matters, in the event of any conflict between the terms and conditions of
 this Agreement and the terms and conditions of any Ancillary Agreement, the terms and conditions
 of this Agreement (including amendments hereto) shall control.

<u>Section 8.2.</u>

<u>Governing Law</u>. This Agreement, except as expressly provided herein, and, unless expressly provided therein, each Ancillary Agreement, shall be governed by and construed and interpreted in accordance with the laws of the State of Nevada, irrespective of the choice of laws principles of the State of Nevada as to all matters, including matters of validity, construction, effect, enforceability, performance, and remedies.

<u>Section 8.3.</u>

<u>Tax Matters</u>. Notwithstanding anything to the contrary in this Agreement, the rights and obligations of the Parties with respect to any and all tax matters shall be exclusively governed by the provisions of the Tax Matters Agreement, except as set forth therein.

<u>Section 8.4.</u>

<u>Assignability</u>. The provisions of this Agreement, each Ancillary Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors and permitted transferees and assigns. Notwithstanding the foregoing, this Agreement shall not be assignable, in whole or in part, by any Party without the prior written consent of the other Party, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be null and void; provided, that a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets, and upon the effectiveness of such assignment the assigning Party shall be released from all of its obligations under this Agreement if the surviving entity of such merger or the transferee of such Assets shall agree in writing, in form and substance reasonably satisfactory to the other Party, to be bound by all terms of this Agreement as if named as a "Party" hereto.

<u>Section 8.5.</u>

<u>Third Party Beneficiaries</u>. Except for the indemnification rights under this Agreement of any Parent Indemnitee or Subsidiary Indemnitee in their respective capacities as such, (a) the provisions of this Agreement and each Ancillary Agreement are solely for the benefit of the Parties and are not intended to confer upon any Person except the Parties any rights or remedies hereunder, and (b) there are no Third Party beneficiaries of this Agreement or any Ancillary Agreement and neither this Agreement nor any Ancillary Agreement shall provide any Third Party with any remedy, claim, liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement or any Ancillary Agreement.

<u>Section 8.6.</u>

<u>Notices</u>. All notices, requests, claims, demands or other communications under this Agreement or any Ancillary Agreement shall be in writing and shall be deemed to be duly given when (a) delivered in person, (b) sent via email, or (c) upon receipt after being deposited in the United States mail or private express mail, postage prepaid, addressed as follows:

---

| |
|:---|
| If to Parent, to: |
| ABVC BioPharma, Inc. |
| 44370 Old Warm Springs Blvd. |
| Fremont, CA 94538 |
| Attn: Uttam Patil |
| Email: uttam@ambrivis.com |
| If to Subsidiary, to: |
| BioKey (Cayman), Inc. |
| 44370 Old Warm Springs Blvd. |
| Fremont, CA 94538 |
| Attn: T.S. Jiang |
| Email: tsjiang@ambrivis.com |

---

Either Party may, by notice to the other Party, change the address to which such notices are to be given.

<u>Section 8.7.</u>

<u>Severability</u>. If any provision of this Agreement or any Ancillary Agreement or the application thereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof or thereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby or thereby, as the case may be, is not affected in any manner adverse to any Party. Upon such determination, the Parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to affect the original intent of the Parties.

<u>Section 8.8.</u>

<u>Publicity</u>. Prior to the Distribution, each of Subsidiary and Parent shall consult with each other prior to issuing any press releases or otherwise making public statements with respect to the Separation, the Distribution or any of the other transactions contemplated hereby and prior to making any filings with any Governmental Authority with respect thereto.

<u>Section 8.9.</u>

<u>Expenses</u>. Except as expressly set forth in this Agreement or in any Ancillary Agreement, whether or not the Separation or the Distribution is consummated, all Third Party fees, costs and expenses paid or incurred in connection with the Separation and Distribution shall be paid by the Parent. All such fees, costs, and expenses so advanced shall be repaid by Subsidiary following the Distribution, pursuant to the terms and conditions negotiated by the Parent and the Subsidiary.

<u>Section 8.10.</u>

<u>Headings</u>. The article, section and paragraph headings contained in this Agreement and in the Ancillary Agreements are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement or any Ancillary Agreement.

<u>Section 8.11.</u>

<u>Survival of Covenants</u>. Except as expressly set forth in any Ancillary Agreement, all covenants, representations, and warranties contained in this Agreement and each Ancillary Agreement, and liability for the breach of any obligations contained herein, shall survive after the Distribution Date and remain in full force and effect in accordance with their applicable terms.

<u>Section 8.12.</u>

<u>Waivers of Default</u>. No action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any Party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

<u>Section 8.13.</u>

<u>Specific Performance</u>. The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled, in addition to any other remedy or relief to which they may be entitled, to injunctive relief (including provisional or temporary injunctive relief) to enforce specifically the terms and provisions hereof and enforcement of any such award of an arbitral tribunal in any court of the United States, or any other any court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction.

<u>Section 8.14.</u>

<u>Amendments</u>. This Agreement may not be modified or amended except by an agreement in writing signed by each of the Parties.

<u>Section 8.15.</u>

<u>Waiver of Jury Trial</u>. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS <u>Section 8.15</u>.

<u>Section 8.16.</u> 

<u>Arbitration</u>. Any dispute with respect to this Agreement or any Ancillary Agreement shall be arbitrated in Alameda County, California, in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. There will be a single neutral arbitrator selected who resides in Alameda County, California. The American Arbitration Association will provide a list of five (5) neutral arbitrators. The claimant and respondent will take turns, with the respondent going first, striking one name at a time from the list of five neutral arbitrators. Each Party will have no more than twenty-four (24) hours to take its turn striking the name of a neutral arbitrator. The final remaining arbitrator will serve as the neutral arbitrator. Either Party may apply to the arbitrator seeking injunctive relief until the arbitrator's award is rendered or the controversy is otherwise resolved. Either Party also may, without waiving any remedy under this Agreement or any Ancillary Agreement, seek from any California court having jurisdiction, any interim or provisional relief that is necessary to protect the rights and/or property of that Party, pending the determination of the arbitrator.

<u>Section 8.17.</u>

<u>Post-Distribution Relationship</u>. The Parties acknowledge that, following the Distribution, Parent will continue to hold [ ]% of the outstanding Ordinary Shares and will therefore exercise control over Subsidiary. In connection therewith, the Parties agree to the following provisions, which shall remain in effect for so long as Parent holds a majority of the outstanding Ordinary Shares:

● Any transaction between Parent (or any of its Affiliates, other than Subsidiary) and Subsidiary entered into after the Distribution Date shall be on terms no less favorable to Subsidiary than those that would be obtainable in an arm's-length transaction with an unrelated Third Party. Any such transaction involving consideration in excess of $100,000 shall require the prior approval of a majority of the independent members of the Board of Directors of Subsidiary (or, if no independent directors have been appointed, a committee of the Board of Directors of Subsidiary composed of directors who are not officers, directors, or employees of Parent).

● Parent shall, and shall cause its Affiliates (other than Subsidiary) to, present to Subsidiary any business opportunity that relates primarily to the Subsidiary Business before pursuing such opportunity for its own account or for the account of any of its other Affiliates. Subsidiary shall have a period of thirty (30) days following written notice of any such opportunity to elect to pursue such opportunity. If Subsidiary declines or fails to respond within such period, Parent and its Affiliates shall be free to pursue such opportunity without further obligation to Subsidiary.

● Parent shall not, and shall cause its Affiliates not to, take any action, directly or indirectly, to (a) cause Subsidiary to issue additional Ordinary Shares or other equity securities to Parent or its Affiliates (other than Subsidiary) at a price below fair market value, or (b) effect any merger, consolidation, or similar transaction the purpose or effect of which is to eliminate or materially reduce the ownership interest of the minority holders of Ordinary Shares, in each case without the prior approval of a majority of the independent members of the Board of Directors of Subsidiary and, to the extent required by applicable Law, the affirmative vote of a majority of the Ordinary Shares held by shareholders other than Parent and its Affiliates.

**IN WITNESS WHEREOF**, the Parties have caused this Separation and Distribution Agreement to be executed by their duly authorized representatives as of the day and year first above written.

---

| | |
|:---|:---|
| ABVC BioPharma, Inc. | ABVC BioPharma, Inc. |
| a Nevada corporation | a Nevada corporation |
| By: | */s/ Uttam Patil* |
| Name: | Uttam Patil |
| Title: | Chief Executive Officer |
| BioKey (Cayman), Inc. | BioKey (Cayman), Inc. |
| a Cayman Island exempted company with limited liability | a Cayman Island exempted company with limited liability |
| By: | */s/ T.S. Jiang* |
| Name: | T.S. Jiang |
| Title: | Chief Executive Officer |

---

**Schedule 1.1(a) to Separation and Distribution Agreement**

**Subsidiary Balance Sheet**

**Schedule 2.1(a) to Separation and Distribution Agreement**

**Subsidiary Assets**

## Exhibit 3.1

**Exhibit 3.1**

![](ea029154601_ex3-1img1.jpg)

CF-401296 Certificate Of Incorporation I, LISA MOORE-JERVIS Assistan DO HEREBY CERTIFY, pursuant to the Con es Act requirements of the said Act in respect of registration were co hed wi h wy 14th day of June Two Thousand Twenty Assistant Registrar of Companies, Cayman Islands. Authorisation Code : 549815422965 www.verify.gov.ky 05 July 2023

## Exhibit 3.2

**Exhibit 3.2**

**Company No. : 401296**

**CAYMAN ISLANDS**

**The Companies Act (Revised)**

**MEMORANDUM and ARTICLES**

**of** **ASSOCIATION**

**OF**

**BioKey (Cayman), Inc.**

**Incorporated on the 14<sup>th</sup> day of June, 2023**

**INCORPORATED IN CAYMAN ISLANDS**

![](ea029154601_ex3-2img1.jpg)

**THE COMPANIES ACT <br> (REVISED)**

**COMPANY LIMITED BY SHARES**

**MEMORANDUM OF ASSOCIATION**

**OF**

**BioKey (Cayman), Inc.**

1. The name of the Company is **BioKey (Cayman), Inc.** 

2. The registered office will be situated at the offices of:

Corporate Filing Services Ltd, P.O. Box 61, 3<sup>rd</sup> Floor Harbour Centre, North Church Street, Grand Cayman, KY1-1102, Cayman Islands

or at such other place in the Cayman Islands as the Directors may from time to time decide.

3. The main object as business activity for the Company is Pure
Equity Holding Company. The objects for which the Company is established are unrestricted and the Company shall have full power to carry
out any object not prohibited by any law as provided by Section 7 (4) of the Companies Act (Revised).

4. Except as prohibited or limited by the laws of the Cayman
Islands, the Company shall have full power and authority to carry out any object and shall have and be capable of from time to time and
at all times exercising any and all of the powers at any time or from time to time exercisable by a natural person or body corporate
in any part of the world whether as principal, agent, contractor or otherwise.

5. The Company shall not be permitted to carry on any business
where a licence is required under the laws of the Cayman Islands to carry on such a business until such time as the relevant licence
has been obtained.

6. If the Company is an exempted company its operations will
be caried out subject to the provisions of Section 174 of the Companies Act (Revised).

7. The liability of each Member is limited to the amount from
time to time unpaid on such Member's share.

*Auth Code: B17172894711 <br> www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. The authorised share capital of the Company is **US$50,000.00** consisting of **500,000,000** shares of **US$0.0001** each with the power for the Company to increase or reduce the said capital and to issue any part of its capital, original or increased, with or without any preference, priority or special privilege or subject to any postponement of rights or to any conditions or restrictions; and so that, unless the condition of issue shall otherwise expressly declare, every issue of shares, whether declared to be preference or otherwise, shall be subject to the power hereinbefore contained.

9. Capitalised terms that are not defined in this Memorandum of Association bear the same meaning as those given in the Articles of Association of the Company

The Subscriber whose name and address are subscribed herein is desirous of being formed into a Company limited by shares and in pursuance of this Memorandum of Association, the Subscriber agrees to take the shares in the capital of the Company set opposite their name.

DATED the 14<sup>th</sup> day of June, Two Thousand and Twenty Three.

---

| | | |
|:---|:---|:---|
| **NAME OF SUBSCRIBER** | **OCCUPATION** | **NO OF SHARES TAKEN BY SUBSCRIBER** |
| **A.S. Nominees Ltd.** P.O. Box 61, 3<sup>th</sup> Floor<br> Harbour Centre<br> North Church Street<br> Grand Cayman<br> KY1-1102<br> Cayman Islands | Nominee Company | One |

---

---

| |
|:---|
| /s/ Damien Austin |
| A.S. Nominees Ltd. |
| By its duly authorised officer |
| Damien Austin |
| Witness to the above signature |
| /s/ Dareen Ebanks |
| Dareen Ebanks |

---

2 *Auth Code: B17172894711 <br> www.verify.gov.ky*

---

| | |
|:---|:---|
| ![](ea029154601_ex3-2img2.jpg) | ![](ea029154601_ex3-2img1.jpg) |

---

**THE COMPANIES ACT <br> (REVISED)** 

**COMPANY LIMITED BY SHARES**

**ARTICLES OF ASSOCIATION**

**OF**

**BioKey (Cayman), Inc.**

1. The Regulations contained or incorporated in Table A of the
First Schedule of the Companies Act (Revised) shall not apply to this Company and the following Regulations shall comprise the Articles
of Association of the Company.

**INTERPRETATION**

2. (a) In these Articles the following terms shall have the meanings
set opposite unless the context otherwise requires: -

---

| | |
|:---|:---|
| the Act | the Companies Act (Revised) of the Cayman Islands and any amendment or other statutory modification thereof and where in these Articles any provision of the Act is referred to, the reference is to that provision as modified by law for the time being in force. |
| Articles | these Articles of Association as from time to time amended by Special Resolution. |
| Auditors | the Auditors for the time being of the Company, if any. |
| Company | BioKey (Cayman), Inc. |
| Directors | the directors of the Company for the time being or, as the case may be, the directors assembled as a board. |
| Member | a person who is registered in the Register of Members as the holder of any Share in the Company. |
| Month | a calendar month. |

---

*Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

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| | |
|:---|:---|
| Ordinary Resolution | a resolution of a general meeting passed by a majority of the Members entitled to vote there-at present at the meeting or a written resolution signed by all Members entitled to vote. |
| Registered <br> Office | the registered office of the Company as provided in Section 50 of the Act. |
| Register of<br> Members | the register of Members to be kept pursuant to section 40 of the Act. |
| Secretary | any person appointed by the Directors to perform any of the duties of the secretary of the Company and including any assistant secretary. |
| Seal | the common seal of the Company or any facsimile for official seal for use outside of the Cayman Islands. |
| Share | an ordinary voting share in the capital of the Company. |
| Special Resolution | a resolution of a general meeting passed by a two-thirds majority of the Members entitled to vote there-at present at the meeting or a written resolution signed by all Members entitled to vote and otherwise in accordance with Section 60 of the Act. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless the context otherwise requires, expressions defined in the Act and used herein shall have the meanings so defined.

(c) In these Articles unless the context otherwise requires: -

---

| | |
|:---|:---|
| (i) | words importing the singular number shall include the plural number and vice-versa; |
| (ii | words importing the masculine gender only shall include the feminine gender; and |
| (iii) | words importing persons only shall include companies or associations or bodies of persons whether incorporated or not. |

---

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| | |
|:---|:---|
| (d) | The headings herein are for convenience only and shall not affect the construction of these Articles. |
| 3.0 (a) | Subject to the provisions, if any, in that behalf in the Memorandum of Association, and without prejudice to any special rights previously conferred on the holders of existing Shares, any Share may be issued with such preferred, deferred, or other special rights, or such restrictions, whether in regard to dividend, voting, return of Share capital or otherwise, as the Company may from time to time by Special Resolution determine that,subject to the provisions of section 37 of the Act, any Share may, with the sanction of a Special Resolution, be issued on the terms that it is, or at the option of the Company or the holder is liable, to be redeemed. |

---

2 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If at any time the share capital is divided into different classes of Shares, the rights attached to any class (unless otherwise provided by the terms of issue of the Shares of that class) may be varied with the consent in writing of the holders of three-fourths of the issued Shares of that class or with the sanction of a resolution passed by not less than three-fourths of such holders of the Shares of that class as may be present in person or by proxy at a separate general meeting of the holders of the Shares of that class. To every such separate general meeting, the provisions of these Articles relating to general meetings shall mutatis mutandis apply, but so that the necessary quorum shall be any one or more persons holding or representing by proxy not less than one-third of the issued Shares of the class and that any holder of Shares of the class present in person or by proxy may demand a poll.

4. (a) Every person whose name is entered as a Member in the Register of Members shall, without payment, be entitled to a certificate under the seal of the Company specifying the Share or Shares held by him and the amount paid up thereon, provided that in respect of a Share or Shares held jointly by several persons, the Company shall not be bound to issue more than one certificate, and delivery of a certificate for a Share to one of several joint holders shall be sufficient delivery to all.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If a Share certificate is defaced, lost or destroyed it may be renewed on payment of such fee, if any, and on such terms, if any, as to evidence and indemnity, as the Directors think fit.

5. Except as required by law, no person shall be recognised by the Company as holding any Share upon any trust, and the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or actual interest in any Share (except only as by these Articles or by law otherwise provided or under an order of a court of competent jurisdiction) or any other rights in respect of any Share except an absolute right to the entirety thereof in the registered holder, but the Company may in accordance with the Act issue fractions of Shares.

6. The Shares shall be at the disposal of the Directors, and they may (subject to the provisions of the Act) allot, grant options over, or otherwise dispose of them to such persons, on such terms and conditions, and at such times as they think fit, but so that no Share shall be issued at a discount, except in accordance with the provisions of the Act. The Company shall have no power to issue shares in Bearer form.

3 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

**LIEN**

7. The Company shall have a first and paramount lien on every Share (not being a fully
 paid Share) for all moneys (whether presently payable or not) called or payable at a fixed time in respect of that Share, and the
 Company shall also have a lien on all Shares (other than fully paid-up Shares) standing registered in the name of a single person
 for all moneys presently payable by him or his estate to the Company; but the Directors may at any time declare any Share to be
 wholly or in part exempt from the provision of this Article. The Company's lien, if any, on a Share shall extend to all
 dividends payable thereon.

8. The Company may sell, in such manner as the Directors think fit, any Shares on which the Company has a lien, but no sale shall be made unless some sum in respect of which the lien exists is presently payable nor until the expiration of fourteen days after a notice in writing, stating and demanding payment of such part of the amount in respect of which the lien exists as is presently payable, has been given to the registered holder for the time being of the Share, or the persons entitled thereto by reason of his death or bankruptcy.

9. For giving effect to any such sale, the Directors may authorise some person to transfer the Shares sold to the purchaser thereof. The purchaser shall be registered as the holder of the Shares comprised in any such transfer and he shall not be bound to see to the application of the purchase money, nor shall his title to the Shares be affected by any irregularity or invalidity in the proceedings in reference to the sale.

10. The proceeds of the sale shall be received by the Company and applied in payment of such part of the amount in respect of which the lien exists as is presently payable, and the residue shall (subject to a like lien for sums not presently payable as existed upon the Shares prior to the sale) be paid to the person entitled to the Shares at the date of the sale.

**CALLS ON SHARES**

11. The Directors may from time to time make calls upon the Members in respect of any moneys unpaid on their Shares provided that no call shall be payable earlier than one month from the last call; and each Member shall (subject to receiving at least fourteen days, notice specifying the time or times of payment) pay to the Company at the time or times so specified the amount called on his Shares.

12. The joint holders of a Share shall be jointly and severally liable to pay calls in respect thereof.

13. If a sum called in respect of a Share is not paid before or on the day appointed for payment thereof, the person from whom the sum is due shall pay interest upon the sum at the rate of six per cent per annum from the day appointed for the payment thereof to the time of the actual payment, but the Directors shall be at liberty to waive payment of that interest wholly or in part.

4 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

14. The provisions of these Articles as to the liability of joint holders and as to payment of interest
 shall apply in the case of non-payment of any sum which, by the terms of issue of a Share, becomes payable at a fixed time, whether
 on account of the amount of the Share, or by way of premium, as if the same had become payable by virtue of a call duly made and
 notified.

15. The Directors may make arrangements on the issue of Shares for a difference between the holders in the amount of calls to be paid and
in the times of payment.

16. The Directors may, if they think fit, receive from any Member willing to advance the same all or any part of the moneys uncalled and unpaid
upon any Shares held by him; and upon all or any of the moneys so advanced may (until the same would, but for such advance, become presently
payable) pay interest at such rate (not exceeding without the sanction at the Company in general meeting six per cent per annum) as may
be agreed upon between the Member paying the sum in advance and the Directors.

**FORFEITURE OF SHARES**

17. If a Member fails to pay any call or installment of a call on the day appointed for payment thereof, the Directors may, at any time thereafter
during such time as any part of such call or installment remains unpaid, serve a notice on him requiring payment of so much of the call
or installment as is unpaid, together with any interest which may have accrued.

18. The notice shall name a further day (not earlier than the expiration of fourteen days from the date of the notice) on or before which
the payment required by the notice is to be made and shall state that in the event of non-payment at or before the time appointed, the
Shares in respect of which the call was made will be liable to be forfeited.

19. If the requirements of any such notice as aforesaid are not complied with, any Share in respect of which the notice has been given may
at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of the Directors to that
effect.

20. forfeited Share may be sold or otherwise disposed of on such terms and in such manner as the Directors think fit, and at any time before
a sale or disposition, the forfeiture may be cancelled on such terms as the Directors think fit.

21. A person whose Shares have been forfeited shall cease to be a Member in respect of the forfeited
 Shares, but shall, notwithstanding, remain liable to pay to the Company all moneys which at the date of forfeiture were payable by
 him to the Company in respect of the Shares, but his liability shall cease if and when the Company receives payment in full of the amount due on the Shares.

5 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

22. A statutory declaration in writing that the declarant is a Director of the Company, and that a Share
 in the Company has been duly forfeited on a date stated in the declaration, shall be conclusive evidence of the facts therein stated
 as against all persons claiming to be entitled to the Share. The Company may receive the consideration, if any, given for the Share
 on any sale or disposition thereof and may execute a transfer of the Share in favour of the person to whom the Share is sold or
 disposed of and he shall thereupon be registered as the holder of the Share, and shall not be bound to see to the application of the
 purchase money, if any, nor shall his title to the Share be affected by any irregularity or invalidity in the proceedings in
 reference to the forfeiture, sale or disposal of the Share.

23. The provisions of these Articles as to forfeiture shall apply in the case of nonpayment of any sum which, by the terms of issue of a Share,
becomes payable at a fixed time, whether on account of the amount of the Share, or by way of premium, as if the same had been made payable
by virtue of a call duly made and notified.

**TRANSFER AND TRANSMISSION OF SHARES**

---

| | |
|:---|:---|
| 24. | The instrument of transfer of any Share shall be executed by or on behalf of the transferor (but need not be executed by or on behalf of the transferee unless the Share has been issued nil paid), and the transferor shall be deemed to remain a holder of the Share until the name of the transferee is entered in the Register of Members in respect thereof. |
| 25. | Shares shall be transferred in the following form, or in any usual or common form approved by the Directors: |
|  | I, of in consideration of the sum of $__ paid to me by of (hereinafter called "the Transferee) do hereby transfer to the Transferee the __ Share (or Shares) numbered __ in the Company called .to hold the same unto the Transferee, subject to the several conditions on which I hold the same. |
|  | As witness our hands on the _____ day of ____ 20 |
|  | __________ |
|  | Transferor |
| 26. | The Directors may, in their absolute discretion and without assigning any reason therefore decline to register any transfer of Shares to a person of whom they do not approve. The Directors may also suspend the registration of transfers during the fourteen days immediately preceding the annual general meeting in each year. The Directors may decline to recognise any instrument of transfer unless (a) a fee not exceeding one dollar is paid to the Company in respect thereof, and (b) the instrument of transfer is accompanied by the certificate of the Shares to which it relates, and such other evidence as the Directors may reasonably require to show the right of the transferor to make the transfer. |

---

6 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

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| | |
|:---|:---|
|  | If the Directors refuse to register a transfer of Shares, they shall within one month after the date on which the transfer was lodged with the Company, send to the transferee notice of the refusal. |
| 27. | The legal personal representative of a deceased sole holder of a Share shall be the only person recognised by the Company as having any title to the Share. In case of a Share registered in the names of two or more holders, the survivors or survivor, or the legal personal representatives of the deceased survivor, shall be the only persons recognised by the Company as having any title to the Share. |
| 28. | Any person becoming entitled to a Share in consequence of the death or bankruptcy of a Member shall upon such evidence being produced as may from time to time be properly required by the Directors, have the right either to be registered as a Member in respect of the Share or, instead of being registered himself, to make such transfer of the Share as the deceased or bankrupt person could have made; but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the Share by the deceased or bankrupt person before the death or bankruptcy. |
| 29. | A person becoming entitled to a Share by reason of the death or bankruptcy of the holder shall be entitled to the same dividends and other advantages to which he would be entitled if he were the registered holder of the Share, except that he shall not, before being registered as a Member in respect of the Share, be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company. |

---

**CONVERSION OF SHARES INTO STOCK**

30. The Company may by ordinary Resolution convert any paid-up Shares into stock and reconvert any stock into paid-up Shares of any denomination.

31. The holders of stock may transfer the same, or any part thereof in the same manner and subject to the same regulations as and subject
to which the Shares from which the stock arose might prior to conversion have been transferred, or as near thereto as circumstances admit;
but the Directors may from time to time fix the minimum amount of stock transferable, and restrict or forbid the transfer of fractions
of that minimum, but the minimum shall not exceed the nominal amount of the Shares from which the stock arose.

7 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

32. The holders of stock shall, according to the amount
of the stock held by them, have the same rights, privileges and advantages as regards dividends, voting at meetings of the Company and
other matters as if they held the Shares from which the stock arose, but no such privilege or advantage (except participation in the
dividends and profits of the Company) shall be conferred by any such aliquot part of stock as would not, if existing as Shares, have
conferred that privilege or advantage.

33. Such of the Articles of the Company as are applicable to paid-up Shares shall apply to stock, and the words "Share" and "Member" herein
shall include "stock" and "stock-holder".

**ALTERATION OF CAPITAL**

34. The Company may from time to time by Ordinary Resolution increase the share capital by such sum, to be divided into Shares of such amount,
as the resolution shall prescribe.

35. Subject to any direction to the contrary that may be given by the Company in general meeting, all new' Shares shall be at the disposal
of the Directors in accordance with Article 6.

36. The new Shares shall be subject to the same provisions with reference to the payment of calls, lien, transfer, transmission, forfeiture
and otherwise as the Shares in the original share capital.

37. The Company may by Ordinary Resolution:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) consolidate and divide all or any of its Share capital into
Shares of larger amount than its existing Shares;

(b) sub-divide its existing Shares, or any of them, into Shares of smaller amount than is fixed by the Memorandum of Association, subject
nevertheless to the provisions of section 13 of the Act; and

(c) cancel any Shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person.

38. Subject to the provisions of the Act, the Company may purchase
its own Shares, including any redeemable Shares, provided that the manner of purchase has first been authorised by Ordinary Resolution
and may make payment therefor or for any redemption of Shares in any manner authorised by the Act, including out of capital.

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**STATUTORY MEETINGS**

39. The Company, if registered as an Ordinary Company
under the Act, shall hold a general meeting once in every calendar year at such time and place as may be resolved by the Company in general
meeting or, in default, at such time and place as the Directors may determine or, in default, at such time in the third month following
that in which the anniversary of the Company's incorporation occurs at such place as the Directors shall appoint. In default of
a general meeting being so held, a general meeting shall be held in the month next following and may be convened by any one or more Members
holding in the aggregate not less than one-third of the total issued share capital of the Company entitled to vote and in the same manner
as nearly as possible as that in which meetings are to be convened by the Directors. The above-mentioned general meetings shall be called
annual general meetings; all other general meetings shall be called extraordinary

**GENERAL MEETINGS**

40. The Directors may whenever they think fit, convene an extraordinary
general meeting. If at any time there are not sufficient Directors capable of acting to form a quorum, any Director or any one or more
Members holding in the aggregate not less than one-third of the total issued share capital of the Company entitled to vote may convene
an extraordinary general meeting in the same manner as nearly as possible as that in which meetings may be convened by the Directors.
The Directors shall, upon the requisition in writing of one or more Members holding in the aggregate not less than one-tenth of such
paid-up capital of the Company as at the date of the requisition carries the right of voting at general meetings, convene an extraordinary
general meeting. Any such requisition shall express the object of the meeting proposed to be called and shall be left at the Registered
Office of the Company. If the Directors do not proceed to convene a general meeting within twenty-one days from the date of such requisition
being left as aforesaid, the requisitionists or any or either of them or any other Member or Members holding in the aggregate not less
than one-tenth of such paid-up capital of the Company as at the date of the requisition carries the right of voting at general meetings,
may convene an extraordinary general meeting to be held at the Registered Office of the Company or at some convenient place within the
Cayman Islands at such time, subject to the Company's Articles as to notice, as the persons convening the meeting fix.

41. Not less than seven days' notice (exclusive of the day on which the notice is served or deemed to be served, but inclusive of the
day for which the notice is given) specifying the place, the day and the hour of meeting and, in the case of special business, the general
nature of that business shall be given in manner hereinafter provided, or in such other manner (if any) as may be prescribed by the Company
in general meeting, to such persons as are entitled to vote or may otherwise be entitled under the Articles of the Company to receive
such notices from the Company; but with the consent of all the Members entitled to receive notice of some particular meeting, that meeting
may be convened by such shorter notice or without notice and in such manner as those Members may think fit.

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42. The accidental omission to give notice of a meeting to, or the
non-receipt of a notice of a meeting by, any Member entitled to receive notice shall not invalidate the proceedings at any meeting.

43. All business shall be deemed special that is transacted at an extraordinary general meeting, and all business that is transacted at an
annual general meeting shall be deemed special with the exception of sanctioning a dividend, the consideration of the accounts, balance
sheets, the report of the Directors and Auditors, the election of Directors and/or other officers in the place of those retiring (if
any) and the appointment and fixing of remuneration of Auditors.

44. (a) No business shall be transacted at any general meeting unless
a quorum of Members is present at the time that the meeting proceeds to business; save as herein otherwise provided, one or more Members
holding in the aggregate not less than one-third of the total issued share capital of the Company present in person or by proxy and entitled
to vote shall be a quorum.

(b) An Ordinary Resolution or a Special Resolution (subject to the provisions of the Act) in writing
 signed by all the Members for the time being entitled to receive notice of and to attend and vote at general meetings, (or being
 corporations by their duly authorised representatives) including a resolution signed in counterpart by or on behalf of such Members
 or by way of signed telefax transmission, shall be as valid and effective as if the same had been passed at a general meeting of the
 Company duly convened and held.

45. If within half an hour from the time appointed for the meeting
a quorum is not present, the meeting, if convened upon the requisition of Members, shall be dissolved. In any other case it shall stand
adjourned to the same day in the next week, at the same time and place, and if at the adjourned meeting a quorum is not present within
half an hour from the time appointed for the meeting, the Members present shall be a quorum.

46. The chairman, if any, of the Board of Directors shall preside as chairman at every general meeting of the Company.

47. If there is no such chairman, or if at any meeting he is not present within fifteen minutes after
 the time appointed for holding the meeting or is unwilling to act as chairman, the Members present shall choose one of their number
 to be chairman.

48. The chairman may with the consent of any meeting at which a quorum is present (and shall if so
 directed by the meeting) adjourn the meeting from time to time and from place to place, but no business shall be transacted at any
 adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place. When a meeting is
 adjourned for ten days or more, notice of the adjourned meeting shall be given as in the case of an original meeting. Save as
 aforesaid it shall not be necessary to give any notice of an adjournment or of the business to be transacted at an adjourned meeting.

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49. At any general meeting a resolution put to the vote
 of the meeting shall be decided on a show
 of hands, unless a poll is (before or on the declaration of the result of the show of hands)
 demanded by one or more Members present in person or by a proxy who together hold not less
 than fifteen per cent of the paid up capital of the Company entitled to vote, and, unless
 a poll is so demanded, a declaration by the chairman that a resolution has, on a show of
 hands, been carried or carried unanimously, or by a particular majority, or lost and an entry
 to that effect in the minutes of the proceedings of the Company, shall be conclusive evidence
 of the fact, without proof of the number or proportion of the votes recorded in favour of,
 or against, that resolution.

50. If a poll is duly demanded it shall be taken in such manner as the chairman directs, and the result of the poll shall be deemed to be
the resolution of the meeting at which the poll was demanded.

51. In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes
place or at which the poll is demanded, shall be entitled to a second or casting vote.

52. A poll demanded on the election of a chairman or on a question of adjournment shall be taken forthwith. A poll demanded on any other question
shall be taken at such time as the chairman of the meeting directs.

**VOTES OF MEMBERS**

53. On a show of hands every Member present in person or by proxy and entitled to vote shall have one vote and on a poll every Member entitled
to vote shall have one vote for each Share of which he is the holder.

54. In the case of joint holders, the vote of the senior who tenders a vote whether in person or by proxy, shall be accepted to the exclusion
of the votes of the other joint holders; and for this purpose seniority shall be determined by the order in which the names stand in the
Register of Members.

55. A Member of unsound mind, or in respect of whom an order has been made by any court having
 jurisdiction in lunacy, may vote, whether on a show of hands or on a poll, by his committee or other person in the nature of a
 committee appointed by that court, and any such committee or other person may vote by proxy.

56. No Member shall be entitled to vote at any general meeting unless all calls or other sums presently payable by him in respect of Shares
in the Company have been paid.

57. On a poll votes may be given either personally or by proxy.

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58. The instrument appointing a proxy shall be in writing under the hand of the Member or, if the Member is a corporation, either under seal or under the hand of a director or officer or attorney duly authorised. A proxy need not be a Member of the Company.

59. The instrument appointing a proxy shall be deposited at the
Registered Office of the Company or at such other place as is specified for that purpose in the notice convening the meeting no later
than the time for holding the meeting or adjourned meeting at which the person named in the instrument proposes to vote, and in default
the instrument of proxy shall not be treated as valid PROVIDED THAT the chairman of the meeting may in his discretion accept an instrument
of proxy sent by telex or telefax upon receipt of telex or telefax confirmation that the signed original thereof has been sent.

60. An instrument appointing a proxy may be in the following form
or any other form approved by the Directors:

[ ]

"I, ____________________, of ____________________, hereby appoint _________________of _________________ as my proxy, to vote for me and on my behalf at the [annual or extraordinary, as the case may be] general meeting of the Company to be held on the ______day of______________, 20___.

Signed this _________day of ________________, 20___.

61. The instrument appointing a proxy shall be deemed to confer
authority to demand or join in demanding a poll.

**CORPORATIONS ACTING BY REPRESENTATIVES AT MEETING**

62. Any corporation which is a Member of the Company may by resolution
of its Directors or any committee of the Directors authorise such person as it thinks fit to act as its representative at any meeting
of the Company or of any class of Members of the Company, and the person so authorised shall be entitled to exercise the same powers
on behalf of the corporation which he represents as that corporation could exercise if it were an individual Member of the Company.

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**DIRECTORS AND OFFICERS**

63. (a) The names of the
first Directors shall be determined in writing by the subscribers of the Memorandum of Association.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding any provision in these Articles to the contrary,
a sole Director shall be entitled to exercise all the powers and functions of the Directors which may be conferred on them by Act or
by these Articles.

64. The remuneration of the Directors shall from time to time
be determined by the Company in general meeting. The Directors shall also be entitled to be paid their travelling, hotel and other expenses
properly incurred by them in going to, attending and returning from meetings of the Directors, or any committee of the Directors, or
general meetings of the Company, or otherwise in connection with the business of the Company, or to receive a fixed allowance in respect
thereof as may be determined by the Directors from time to time, or a combination partly of one such method and partly the other.

65. No shareholding qualification shall be required for Directors
unless otherwise required by the Company by Ordinary Resolution.

66. Any Director may in writing appoint another person who is
approved by the majority of the Directors to be his alternate to act in his place at any meeting of the Directors at which he is unable
to be present. Every such alternate shall be entitled to notice of meetings of the Directors and to attend and vote thereat as a Director
when the person appointing him is not personally present, and where he is a Director, to have a separate vote on behalf of the Director
he is representing in addition to his own vote. A Director may at any time, in writing, revoke the appointment of an alternate appointed
by him and such appointment shall be revoked automatically if the appointor of the alternate ceases to be a Director at any time. Every
such alternate shall be an officer of the Company and shall not be deemed to be the agent of the Director appointing him. The remuneration
of such alternate shall be payable out of the remuneration of the Director appointing him and the proportion thereof shall be agreed
between them.

67. The Directors may by resolution appoint one of their number
to be President upon such terms as to duration of office remuneration and otherwise as they may think fit.

68. The Directors may also by resolution appoint a Secretary and
such other officers as may from time to time be required upon such terms as to duration of office, remuneration and otherwise as they
may think fit. Such Secretary or other officers need not be Directors and in the case of the other officers may be ascribed such titles
as the Directors may decide.

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**POWERS AND DUTIES OF DIRECTORS**

69. The business of the Company shall be managed by the
Directors, who may pay all expenses incurred in setting up and registering the Company and may excercise all such powers of the Company
as are not, by the Act or these Articles, required to be exercised by the Company in general meeting, subject, nevertheless, to any clause
of these Articles, to the provisions of the Act, and to such regulations, being not inconsistent with the aforesaid clauses or provisions,
as may be prescribed by the Company in general meeting but no regulation made by the Company in general meeting shall invalidate any
prior act of the Directors which would have been valid if that regulation had not been made.

70. The Directors may exercise all the powers of the Company to
borrow money and to mortgage or charge its undertaking, property and uncalled capital or any part thereof, to issue debentures, debenture
stock and other securities whenever money is borrowed or as security for any debt, liability, or obligation of the Company or of any
third party.

71. (a) The Directors may from time to time and at any time by power
of attorney appoint any company, firm or person or body of persons, whether nominated directly or indirectly by the Directors, to be
the attorney or attorneys of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested
in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit, and
any such powers of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney
as the Directors may think fit and may also authorise any such attorney to delegate all or any of the powers, authorities and discretions
vested in him.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Directors may delegate any of the powers exercisable by
them to a Managing Director or any other person or persons acting individually or jointly as they may from time to time by resolution
appoint upon such terms and conditions (including without limitation as to duration of office and remuneration) and with such restrictions
as they may think fit, and may from time to time by resolution revoke, withdraw, alter, or vary all or any such powers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All cheques promissory notes, drafts, bills of exchange and
other negotiable instruments, and all receipts for moneys paid to the Company shall be signed, drawn, accepted, endorsed, or otherwise
executed, as the case may be, in such manner as the Directors shall from time to time by resolution determine.

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72. The Directors shall cause minutes to be prepared: -

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) of all appointments of officers made by the Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) of the names of the Directors present at each meeting of the
Directors and of any committee of the Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) of all resolutions and proceedings at all meetings of the
Members of the Company and of the Directors and of committees of Directors; and the chairman of all such meetings or of any meeting confirming
the minutes thereof shall sign the same.

**DISQUALIFICATION AND CHANGES OF DIRECTORS**

73. The office of Director shall be vacated if the Director: -

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) becomes bankrupt or makes any arrangement or composition with
his creditors generally; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) is found to be or becomes of unsound mind; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) resigns his office by notice in writing to the Company.

74. At the annual general meeting of the Company in every year
the whole of the Directors shall retire from office but shall be eligible for re-election.

75. The Company at the general meeting at which a Director retires
in manner aforesaid may fill the vacated office by electing a person thereto and in default the retiring Director shall be deemed to
have been re-elected unless at such meeting it is resolved not to fill such vacated office.

76. The number of Directors shall be not less than one, nor unless
the Company in general meeting may otherwise determine, more than ten.

77. Any casual vacancy occurring in the Board of Directors may
be filled by the Directors.

78. The Directors shall have the power at any time, and from time
to time, to appoint a person as an additional Director or persons as additional Directors.

79. The Company may by Ordinary Resolution remove a Director before
the expiration of his period of office and may by Ordinary Resolution appoint another person in his stead. The person so appointed shall
be subject to retirement at the same time as if he had become a Director on the day on which the Director in whose place, he is appointed
was last elected a Director.

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**PROCEEDINGS OF DIRECTORS**

80. The Directors may meet together (either within or
without the Cayman Islands) for the dispatch of business, adjourn, and otherwise regulate their meetings and proceedings, as they think
fit. Questions arising at any meeting shall be decided by a majority of votes. In case of an equality of votes the chairman shall have
a second or casting vote.

81. A Director or alternate Director may, and the Secretary on
the requisition of a Director or alternate Director shall, at any time, summon a meeting of Directors by at least five days' notice in
writing to every Director and alternate Director which notice shall set forth the general nature of the business to be considered PROVIDED
HOWEVER that notice may be waived by all the Directors (or their alternates) either at, before or after the meeting is held PROVIDED
FURTHER that notice or waiver thereof may be given by telex or telefax.

82. The quorum necessary for the transaction of the business of
the Directors, may be fixed by the Directors or their proxies, and unless so fixed by the Directors, shall be two Directors or their
proxies, save where the subscriber of the Memorandum of Association or the Members in general meeting have appointed a sole Director
when such Director acting alone shall constitute a quorum. For the purpose of this Article, an alternate appointed by a Director shall
be counted in a quorum at a meeting at which the Director appointing him is not present.

83. The continuing Directors may act notwithstanding any vacancy
in their body, but, if and so long as their number is reduced below the number fixed by or pursuant to the Articles of the Company as
the necessary quorum of Directors, the continuing Directors may act for the purpose of increasing the number of Directors to that number,
or of summoning a general meeting of the Company, but for no other purpose.

84. Any Director or officer may act by himself or his firm in
a professional capacity for the Company, and he or his firm shall be entitled to remuneration for professional services as if he were
not a Director or officer PROVIDED THAT nothing herein contained shall authorise a Director or officer or his firm to act as Auditor
of the Company.

85. No person shall be disqualified from the office of Director or alternate
Director or prevented by such office from contracting with the Company, either as vendor, purchaser or otherwise, nor shall any such
contract or any contract or transaction entered into by or on behalf of the Company in which any Director or alternate Director shall
be in any way interested be or be liable to be avoided, nor shall any Director or alternate Director so contracting or being so interested
be liable to account to the Company for any profit realised by any such contract or transaction by reason of such Director or alternate
Director holding office or of the fiduciary relation thereby established. A Director (or his alternate Director in his absence) shall
be at liberty to vote in respect of any contract or transaction in which he is so interested as aforesaid PROVIDED HOWEVER that the nature
of the interest of any Director or alternate Director in any such contract or transaction shall be disclosed by him or the alternate
Director appointed by him at or prior to its consideration and any vote thereon and a general notice that a Director or alternate Director
is a shareholder of any specified firm or company and/or is to be regarded as interested in any transaction with such firm or company
shall be sufficient disclosure hereunder and after such general notice it shall not be necessary to give special notice relating to any
particular transaction.

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86. The Directors may elect a chairman of their meetings and determine
the period for which he is to hold office; but if no such chairman is elected, or if at any meeting the chairman is not present within
five minutes after the time appointed for holding the same, the Directors present may choose one of their number to be chairman of the
meeting.

87. The Directors may delegate any of their powers to committees
consisting of such member or members of their body as they think fit; any committee so formed shall, in the exercise of the powers so
delegated, conform to any regulations that may be imposed on it by the Directors.

88. A committee may elect a chairman of its meetings; if no such
chairman is elected, or if at any meeting the chairman is not present within five minutes after the time appointed for holding the same,
the members present may choose one of their number to be chairman of the meeting.

89. A committee may meet and adjourn as it thinks proper. Questions
arising at any meeting shall be determined by a majority of votes of the members present and in case of an equality of votes the chairman
shall not have a second or casting vote.

90. All acts done by any meeting of the Directors or of a committee
of Directors, or by any person acting as a Director shall, notwithstanding that it be afterwards discovered that there was some defect
in the appointment of any such Director or person acting as aforesaid, or that they or any of them were disqualified, be as valid as
if every such person had been duly appointed and was qualified to be a Director.

91. Upon the Directors (being in number at least a quorum) signing
the minutes of a meeting of the Directors the same shall be deemed to have been duly held notwithstanding that the Directors have not
actually come together or that there may have been a technical defect in the proceedings. A resolution signed by all such Directors,
including a resolution signed in counterpart by the Directors or by way of signed telefax transmission, shall be as valid and effectual
as if it had been passed at a meeting of the Directors duly called and constituted. To the extent permitted by law, the Directors may
also meet by telephone conference call where all Directors are capable of speaking to and hearing the other Directors at the same time.

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**SEALS AND DEEDS**

92. (a) If the Directors determine that the Company shall have a common Seal, the Directors shall provide for the safe custody of the common Seal
and the common Seal of the Company shall not be affixed to any instrument except by the authority of a resolution of the Directors, and
in the presence of a Director and of the Secretary or, in place of the Secretary, by such other person as the Directors may appoint for
the purpose, and that Director and the Secretary or other person as aforesaid shall sign every instrument to which the common Seal of
the Company is so affixed in their presence. Notwithstanding the provisions hereof, annual returns and notices filed under the Act may
be executed either as a deed in accordance with the Act or by the common Seal being affixed thereto in either case without the authority
of a resolution of the Directors by one Director or the Secretary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Company may maintain a facsimile of any common Seal in such
countries or places as the Directors shall appoint and such facsimile Seal shall not be affixed to any instrument except by the authority
of the Directors and in the presence of such person or persons as the Directors shall for this purpose appoint and such person or persons
as aforesaid shall sign every instrument to which the facsimile Seal of the Company is so affixed in their presence and such affixing
of the facsimile Seal and signing as aforesaid shall have the same meaning and effect as if the common Seal had been affixed in the presence
of and the instrument signed by a Director and the Secretary or such other person as the Directors may appoint for the purpose.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In accordance with the Act, the Company may execute any deed or other instrument which would
 otherwise be required to be executed under Seal by the signature of such deed or instrument as a deed by two Directors of the
 Company or where there is a Sole Director of the Company, by such Sole Director, or by a Director and the Secretary of the Company
 or, in place of the Secretary, by such other person as the Directors may appoint or by any other person or attorney on behalf of the
 Company appointed by a deed or other instrument executed as a deed by two Directors of the Company, or a Sole Director or by a
 Director and the Secretary or such other person as aforesaid.

**DIVIDENDS AND RESERVE**

93. The Company may by Ordinary Resolution declare dividends, but
no dividend shall exceed the amount recommended by the Directors.

94. The Directors may from time to time pay to the Members interim
dividends.

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95. No dividend shall be paid otherwise than out of profits or out of monies otherwise available for dividend in accordance with the Act.

96. Subject to the rights of persons, if any, entitled to Shares with special rights as to dividends,
 all dividends on any class of Shares not fully paid shall be declared and paid according to the amounts paid on the Shares of that class, but if and so long as nothing is paid up on any of the Shares in the Company,
dividends may be declared and paid according to the number of Shares. No amount paid on a Share in advance of calls shall, while carrying
interest, be treated for the purposes of this article as paid on the Share.

97. The Directors may, before recommending any dividend, set aside
out of the profits of the Company such sums as they think proper as a reserve or reserves which shall, at the discretion of the Directors,
be applicable for meeting contingencies, or for equalizing dividends, or for any other purpose to which the profits of the Company may
be properly applied, and pending such application may, at their like discretion, either be employed in the business of the Company or
be invested in such investments as the Directors may from time to time think fit.

98. If several persons are registered as joint holders of any Share,
any of them may give effectual receipts for any dividend or other monies payable on or in respect of the Share.

99. Any dividend may be paid by cheque or warrant sent through the
post to the registered address of the Member or person entitled thereto or in the case of joint holders to any one of such joint holders
at his registered address or to such person at such address as the Member or person entitled or such joint holders, as the case may be,
may direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent or to the order of such
other person as the Member or person entitled or such joint holders, as the case may be, may direct.

100. The Directors may declare that any dividend is paid wholly or
partly by the distribution of specific assets and in particular of paid-up shares, debentures or debenture stock of any other company
or in any one or more of such ways, and the Directors shall give effect to such resolution, and where any difficulty arises with regard
to such distribution, the Directors may settle the same as they think expedient, and in particular may issue fractional certificates
and fix the value for distribution of such specific assets or any part thereof and may determine that cash payments shall be made to
any Members upon the footing of the value so fixed in order to adjust the rights of all parties, and may vest any such specific assets
in trustees as may seem expedient to the Directors.

101. No dividend shall bear interest against the Company.

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**CAPITALISATION OF PROFITS**

102. The Company may upon the recommendation of the Directors by
Ordinary Resolution authorise the Directors to capitalise any sum standing to the credit of any of the Company's reserve accounts (including share premium account and capital redemption reserve fund) or any sum standing to the
credit of the profit and loss account or otherwise available for distribution and to appropriate such sums to Members in the proportions
in which such sum would have been divisible amongst them had the same been a distribution of profits by way of dividend and to apply such
sum on their behalf in paying up in full unissued Shares for allotment and distribution credited as fully paid up to and amongst them
in the proportion aforesaid. In such event the Directors shall do all action and things required to give effect to such capitalisation,
with full power to the Directors to make such provision as they think fit for the case of Shares becoming distributable in fractions (including
provision whereby the benefit of fractional entitlements accrue to the Company rather than to the Members concerned). The Directors may
authorise any person to enter on behalf of all the Members interested into an agreement with the Company providing for such capitalisation
and matters incidental thereto and any agreement made under such authority shall be effective and binding on all concerned.

**ACCOUNTS**

103. The books of account relating to the Company's affairs shall
be kept in such manner as may be determined from time to time by the Company by Ordinary Resolution or failing such determination by
the Directors of the Company.

104. The Company may by Ordinary Resolution from time to time determine
or, failing such determination, the Directors may from time to time determine that Auditors shall be appointed and that the accounts
relating to the Company's affairs shall be audited in such manner as the Company by Ordinary Resolution or the Directors (as the case
may be) shall determine PROVIDED THAT nothing contained in this Article shall require Auditors to be appointed or the accounts relating
to the Company's affairs to be audited.

**WINDING UP**

105. If the Company shall be wound up, the liquidator may, with the sanction of a Special Resolution of
 the Company and any other sanction required by the Act, divide amongst the Members in specie or kind the whole or any part of the
 assets of the Company (whether they shall consist of property of the same kind or not) and may for such purpose set such value as he
 deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between the
 Members or different classes of Members. The liquidator may with the like sanction, vest the whole or any part of such assets in
 trustees upon such trusts for the benefit of the contributors as the liquidator, with the like sanction, shall think fit, but so
 that no Member shall be compelled to accept any Shares or other securities upon which there is any liability. This Article is to be
 without prejudice to the rights of the holders of Shares issued upon special terms and conditions.

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106. If the Company shall be wound up and the assets available for
distribution amongst the Members as such shall be insufficient to repay the whole of the paid up capital, such assets shall be distributed
so that, as nearly as may be, the losses shall be borne by the Members in proportion to the capital paid up, or which ought to have been
paid up, at the commencement of the winding up, on the Shares held by them respectively. And if in a winding up the assets available
for distribution amongst the Members shall be more than sufficient to repay the whole of the capital paid up at the commencement of the
winding up, the excess shall be distributed amongst the Members in proportion to the capital paid up at the commencement of the winding
up on the Shares held by them, respectively. This Article is to be without prejudice to the rights of the holders of Shares issued upon
special terms and conditions.

**NOTICES**

107. (a) A notice may be given by the Company to any Member either personally
or by sending it by post, telex or telefax to him to his registered address, or (if he has no registered address) to the address, if
any, supplied by him to the Company for the giving of notices to him.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Where a notice is sent by post, service of the notice shall
be deemed to be effected by properly addressing, prepaying, and posting a letter containing the notice (by airmail if the address is
outside the Cayman Islands) and to have been effected, in the case of a notice of a meeting at the expiration of three days after the
time at which the letter would be delivered in the ordinary course of post.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Where a notice is sent by telex or telefax, service of the notice
shall be deemed to be effected by properly addressing and sending such notice through the appropriate transmitting medium and to have
been effected on the day the same is sent.

108. If a Member has no registered address and has not supplied to
the Company an address for the giving of notice to him, a notice addressed to him and advertised in a newspaper circulating in the Cayman
Islands shall be deemed to be duly given to him at noon on the day following the day on which the newspaper is circulated, and the advertisement
appeared therein.

109. A notice may be given by the Company to the joint holders of
a Share by giving the notice to the joint holder named first in the Register of Members in respect of the Share.

21 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

110. A notice may be given by the Company to the person entitled to a Share in consequence of the death
 or bankruptcy of a Member by sending it through the post in a prepaid letter addressed to them by name, or by the title of
 representatives of the deceased, or trustee of the bankrupt, or by any like description, at the address, if any supplied
 for the purpose by the persons claiming to be so entitled or (until such an address has been so supplied) by giving the notice in
 any manner in which the same might have been given if the death or bankruptcy had not occurred.

111. Notice of every general meeting shall be given in the same
manner hereinbefore authorised to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) every Member entitled to vote, except those Members entitled
to vote who (having no registered address) have not supplied to the Company an address for the giving of notices to them; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) every person entitled to a Share in consequence of the death
or bankruptcy of a Member, who, but for his death or bankruptcy would be entitled to receive notice of the meeting.

No other persons shall be entitled to receive notices of general meetings.

**RECORD DATE**

112. The Directors may fix in advance a date as the record date
for any determination of Members entitled to notice of or to vote at a meeting of the Members and, for the purpose of determining the
Members entitled to receive payment of any dividend, the Directors may, at or within 90 days prior to the date of the declaration of
such dividend, fix a subsequent date as the record date for such determination.

**AMENDMENT OF MEMORANDUM AND ARTICLES**

113. Subject to and insofar as permitted by the provisions of the
Act, the Company may from time to time by Special Resolution alter or amend its Memorandum of Association or these Articles in whole
or in part provided however that no such amendment shall effect the rights attaching to any class of shares without the consent or sanction
provided for in Article 3 (b).

**ORGANISATION EXPENSES**

114. The preliminary and organisation expenses incurred in forming
the Company shall be paid by the Company and may be amortised in such manner and over such period of time and at such rate as the Directors
shall determine and the amount so paid shall in the accounts of the Company, be charged against income and/or capital.

22 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

**OFFICES OF THE COMPANY**

115. The Registered Office of the Company shall be at
PO Box 613, Grand Cayman KY1-1107, Cayman Islands or at such address in the Cayman Islands as the Directors shall from time to time determine.
The Company, in addition to its Registered Office, may establish and maintain an office in the Cayman Islands or elsewhere as the Directors
may from time to time determine.

**INDEMNITY**

116. Every Director and officer for the time being of the Company
or any trustee for the time being acting in relation to the affairs of the Company and their respective heirs, executors, administrators,
personal representatives or successors or assigns shall, in the absence of wilful neglect or default, be indemnified by the Company against,
and it shall be the duty of the Directors out of the funds and other assets of the Company to pay, all costs, losses, damages and expenses,
including travelling expenses, which any such Director, officer or trustee may incur or become liable in respect of by reason of any
contract entered into, or act or thing done by him as such Director, officer or trustee or in any way in or about the execution of his
duties and the amount for which such indemnity is provided shall immediately attach as a lien on the property of the Company and have
priority as between the Members over all other claims. No such Director, officer or trustee shall be liable or answerable for the acts,
receipts, neglects or defaults or any other Director, officer or trustee or for joining in any receipt or other act for conformity or
for any loss or expense happening to the Company through the insufficiency or deficiency of any security in or upon which any of the
monies of the Company shall be invested or for any loss of the monies of the Company which shall be invested or for any loss or damage
arising from the bankruptcy, insolvency or tortious act of any person with whom any monies, securities or effects shall be deposited,
or for any other loss, damage or misfortune whatsoever which shall happen in or about the execution of the duties of his respective office
or trust or in relation thereto unless the same happens through his own wilful neglect or default.

23 *Auth Code: G44050399778<br>www.verify.gov.ky*

![](ea029154601_ex3-2img1.jpg)

**FINANCIAL YEAR-END**

117. Unless the Directors otherwise prescribe, the financial
year of the Company shall end on 31 December in each year and, following the year of incorporation, shall begin on 1 January in each
year.

DATED the 14<sup>th</sup> day of June, Two Thousand and Twenty Three.

---

| | |
|:---|:---|
| **NAME OF SUBSCRIBER** | **DESCRIPTION OF SUBSCRIBER** |
| A.S. Nominees Ltd. P.O. Box 61, 3<sup>rd</sup> Floor<br> Harbour Centre<br> North Church Street<br> Grand Cayman<br> KY1-1102<br> Cayman Islands | Nominee Company |

---

---

| |
|:---|
| /s/ Damien Austin |
| A.S. Nominees Ltd. |
| By its duly authorised officer |
| Damien Austin |
| Witness to the above signature |
| /s/ Dareen Ebanks |
| Dareen Ebanks |

---

24 *Auth Code: G44050399778<br>www.verify.gov.ky*

## Exhibit 10.1

**Exhibit 10.1**

**TRANSITIONAL SERVICES AGREEMENT**

This Transitional Services Agreement (the "**Agreement**") is dated as of [ ] 2026, between ABVC BioPharma, Inc., a Nevada corporation ("**Parent**"), and BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability ("**Subsidiary**"). As used herein, Parent on the one hand, and Subsidiary, on the other hand, are sometimes referred to individually as a "**Party**", or together, as "**Parties**".

WHEREAS, prior to the Distribution (as defined below), Subsidiary is a wholly owned subsidiary of Parent;

WHEREAS, the Board of Directors of Parent has determined that it is in the best interests of Parent and its shareholders to separate the Subsidiary's business from that of the Parent through a spin-off transaction;

WHEREAS, following the consummation of the distribution (the "**Distribution**") contemplated by the Separation and Distribution Agreement dated of even date herewith among Parent and Subsidiary (the **"Separation Agreement**"), Subsidiary desires that Parent provide certain administrative services to Subsidiary; and

WHEREAS, subject to the terms and conditions of this Agreement, each Party is willing to provide the other Party with such services for a transitional period.

NOW, THEREFORE, the parties agree as follows:

**Section 1. Services.** Commencing at the time of the Distribution, Parent agrees to provide, or to coordinate the provision by others, to Subsidiary the transitional services set forth on <u>Exhibit A</u> hereto (the "**Services**"). Without limiting the foregoing, the Parties may modify the Services from time to time and may identify additional services to incorporate into this Agreement via the written consent of both parties, which shall not be unreasonably withheld.

**Section 2. Provision of Services.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In providing the Services Parent may, subject to the prior written consent of Subsidiary, employ consultants and other advisors in addition to utilizing its own employees, in accordance with Section 6 hereof. Such Services are intended to be generally comparable in type and quantity to that which Parent provided to Subsidiary, its affiliates and its businesses prior to the Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Limitation of Liability; Indemnification of Subsidiary. Parent shall have no liability to Subsidiary with respect to Parent's furnishing any of the Services hereunder, including Services provided by any subcontractor or other personnel appointed pursuant to Section 6 hereof, except for liabilities arising out of willful misconduct or gross negligence occurring after the Distribution. Parent will indemnify, defend and hold harmless Subsidiary, its affiliates and its businesses in respect of all liabilities related to, arising from, asserted against or associated with such willful misconduct or gross negligence. Such indemnification obligation shall be a liability of Parent. In no event shall Parent have any liability for any incidental, indirect, special or consequential damages, whether caused by or resulting from negligence or breach of obligations hereunder and whether or not aware of the possibility of the existence of such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Limitation of Liability; Indemnification of Parent. Subsidiary shall indemnify and hold harmless Parent, its affiliates and its businesses in respect of all liabilities related to, arising from, asserted against or associated with Parent's furnishing or failing to furnish the Services provided for in this Agreement, other than liabilities arising out of the willful misconduct or gross negligence of Parent following the Distribution. Such indemnification obligation shall be a liability of Subsidiary. In no event shall Subsidiary have any liability for any incidental, indirect, special or consequential damages, whether caused by or resulting from negligence or breach of obligations hereunder and whether informed or aware of the possibility of the existence of such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subrogation of Rights Vis-A-Vis Third Party Contractors. In the event any liability arises from the performance of Services hereunder by a third party contractor, upon indemnification of Parent and/or its representatives, including but not limited to Parent's officers, directors, employees, accountants, counsel, investment bankers, financial advisors and consultants, Subsidiary shall be subrogated to such rights, if any, as Parent may have against such third party contractor with respect to the Services provided by such third party contractor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Laws and Governmental Regulations. Subsidiary shall be solely responsible for compliance with all applicable laws, rules and regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Relationship of Parties. Nothing in this Agreement shall be deemed or construed by the Parties or any third party as creating the relationship of principal and agent, partnership or joint venture between the Parties, it being understood and agreed that no provision contained herein, and no actions of the Parties, shall be deemed to create any relationship between the Parties other than the relationship of independent contractor nor be deemed to vest any rights, interest or claims in any third parties.

**Section 3. Term; Standard of Care.** Parent shall provide the Services to Subsidiary as Subsidiary may request for a period of up to six (6) months from the date of the Distribution ("**Term**"); provided that, such initial Term may be extended thereafter for subsequent three month terms in whole or in part by mutual agreement of the Parties; provided, further, that Subsidiary may terminate the Services at any time and for any reason on not less than ten (10) business days' prior written notice to Parent. In providing the Services hereunder, Parent will exercise the same degree of care as it has exercised in providing such Services to its affiliates prior to the date hereof.

**Section 4. Designated Representatives.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Appointment. Each Party shall designate its Chief Executive Officer as its representative (each, a "**Designated Representative**") for the Term. The Designated Representatives shall oversee the implementation and application of this Agreement and shall always reasonably and in good faith attempt to resolve any dispute between the Parties. Each Party shall have the right to designate an alternative senior officer of comparable authority to act in place of its Chief Executive Officer as its Designated Representative upon reasonable prior written notice to the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Decision Making. All decisions of the Designated Representatives under this Agreement shall be taken unanimously. If the Designated Representatives fail to make a decision, resolve a dispute, or agree upon any necessary action within thirty (30) days, or if a Party so requests in the event of a material breach of this Agreement, the dispute shall be referred to an independent senior officer of each Party, neither of whom shall have any direct oversight or responsibility for the subject matter in dispute, who shall attempt within a period of thirty (30) days thereafter to conclusively resolve any such unresolved issue, which such decision shall be final and binding on all Parties. In the event that such senior officers are unable to conclusively resolve the dispute within such thirty (30) day period, the dispute shall be referred to and finally resolved by binding arbitration in accordance with Section 9(n) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Consultation. During the Term, the Designated Representatives shall consult, in person or via teleconference, at least once each fiscal quarter, or less frequently if agreed by the Designated Representatives. In addition, the Designated Representatives shall consult as often as necessary to promptly resolve any disputes submitted by any representative of either Party.

**Section 5. Compensation.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Charges for Services. Subsidiary will pay Parent the charges, if any, set forth on <u>Exhibit A</u> hereto (collectively, the "**Transition Services Schedules**") for the Services set forth herein as may be adjusted, from time to time, in accordance with this Agreement; provided that, if no charges are specifically indicated otherwise on the Transition Services Schedules, the cost of Services provided under the Transitional Services Schedules will be charged at a flat fee of $5,000 per month. The Parties intend, having regard to the reciprocal and transitional nature of the Agreement as well as other factors, for the charges to be easy to administer and justify; and therefore, recognize it may be counter-productive to try and recover every cost, charge or expense, particularly those which are insignificant or de minimis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Taxes. The fees and charges payable under this Agreement are exclusive of any sales tax or excise tax or other similar charges which may be imposed by a governmental authority. Each Party agrees to remit to the other any such charges promptly upon being billed by the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Corrections/Adjustments. The Parties agree to develop, through the Designated Representatives or their Boards of Directors, mutually acceptable reasonable processes and procedures for conducting any reviews and adjusting thereof. Payments will then be promptly billed and paid.

**Section 6. Personnel.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Right to designate and change personnel. Parent will have the right to designate which personnel it will assign to perform such Services. Parent also will have the right to remove and replace any such personnel at any time or designate any of its affiliates or a Subcontractor (as defined below) at any time to perform the Services, subject to the provisions of Section 6(c) hereof: provided, however, that Parent will use Commercially Reasonable Efforts (as defined below) to limit the disruption to Subsidiary in the transition of the Services to different personnel or to a Subcontractor. In the event that personnel with the designated level of experience are not then employed by Parent, Parent will use Commercially Reasonable Efforts to provide such personnel or Subcontractor personnel having an adequate level of experience; provided, however, that Parent will have no obligation to retain any individual employee for the sole purpose of providing the applicable Services. For the purposes of this Agreement, the term "**Commercially Reasonable Efforts**" means the efforts that a reasonable and prudent person desirous of achieving a business result would use in similar circumstances to ensure that such result is achieved as expeditiously as possible in the context of commercial relations of the type envisaged by this Agreement; provided, however, that an obligation to use Commercially Reasonable Efforts under this Agreement does not require the person subject to that obligation to assume any material obligations or pay any material amounts to a third party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Financial Responsibility. Parent will pay for all personnel expenses, including wages, of its employees performing the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Service Managers and Chief Representatives. During the Term of this Agreement, Parent will appoint (i) one of its employees (the "**Service Manager**") who will have overall responsibility for managing and coordinating the delivery of the Services and who shall serve as such Party's Designated Representative and (ii) one of its employees for each service as indicated in each Transition Services Schedule (the "**Chief Representative**"). The Service Manager and the Chief Representatives will coordinate and consult with Subsidiary. Parent may, at its discretion, select other individuals to serve in these capacities during the Term upon providing notice to the other Party. For the avoidance of doubt, a Chief Representative may serve as such in respect of one or more Transition Services Schedules.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subcontractors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Subcontractors. Parent may, subject to Section 6(d)(2) hereof, engage a "Subcontractor" to perform all or any portion of Parent's duties under this Agreement, provided that any such Subcontractor agrees in writing to be bound by confidentiality obligations at least as protective as the terms of Section 9(m) of this Agreement regarding confidentiality and non-use of information, and provided further that Parent remains responsible for the performance of such Subcontractor and for paying the Subcontractor. As used in this Agreement, "**Subcontractor**" will mean any person or entity engaged to perform hereunder, other than employees of Parent or its affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Assignment. In the event of any subcontracting by Parent to a non-affiliate of Parent of all or any portion of Parent's duties under this Agreement, Parent shall assign and transfer to Subsidiary the full benefit of all such non-affiliate subcontractor's performance covenants, guarantees, warranties or indemnities (if any), to the extent same are transferable or assignable, in the respect of the portion of the Services provided to Subsidiary pursuant to such subcontracting; and if such guarantees, warranties, indemnities and benefits are not assignable, Parent shall use Commercially Reasonable Efforts to procure the benefit of same for Subsidiary through other legal permissible means. Parent will also reasonably endeavor to permit the assignment of any Subcontractor engagement to Subsidiary or its affiliates at the request of Subsidiary upon termination of Service hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Insurance. Each Party shall obtain and maintain at its own expense insurance of the type generally maintained in the ordinary course of its business. Except as otherwise specified in the Transition Services Schedules, Parent shall not be required to obtain and maintain any insurance in relation to providing any Service.

**Section 7. Consents of Third Parties.** Each Party shall use commercially reasonable efforts, at the other Party's direction and expense, to obtain any consents from third parties necessary for the continuation of the requested Services; provided, that such Party shall have no obligation to provide Services for which such consent is required and shall not have been obtained, despite such Party's use of commercially reasonable efforts to obtain such consent.

**Section 8. Disclaimer of Warranties.** SUBJECT TO SECTION 3 HEREOF, EACH OF THE PARTIES DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE SERVICES PROVIDED HEREUNDER. NEITHER PARENT NOR SUBSIDIARY MAKES ANY REPRESENTATIONS OR WARRANTIES AS TO THE QUALITY, SUITABILITY OR ADEQUACY OF THE SERVICES FOR ANY PURPOSE OR USE.

**Section 9. Miscellaneous Provisions.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) *Complete Agreement; Construction*. This Agreement, the Ancillary Agreements and the Exhibits and Schedules hereto and thereto contain the entire agreement between the Parties with respect to the subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter, and there are no agreements or understandings between the Parties other than those set forth or referred to herein or therein. Except with respect to tax matters, in the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of any Ancillary Agreement, the terms and conditions of this Agreement (including amendments hereto) shall control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) *Modification or Amendment.* This Agreement may not be modified or amended except by an agreement in writing signed by each of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) *Counterparts.* This Agreement and each Ancillary Agreement may be executed in separate counterparts, each such counterpart being deemed to be an original instrument, and which counterparts shall together constitute the same agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) *Governing Law.* This Agreement, except as expressly provided herein, and, unless expressly provided therein, each Ancillary Agreement, shall be governed by and construed and interpreted in accordance with the laws of the State of Nevada, irrespective of the choice of laws principles of the State of Nevada as to all matters, including matters of validity, construction, effect, enforceability, performance, and remedies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) *Notices.* Any notice, request or other document required or permitted to be given or delivered pursuant hereto shall be delivered in accordance with the notice provisions of the Separation Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) *Headings.* The article, section and paragraph headings contained in this Agreement and in the Ancillary Agreements are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement or any Ancillary Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) *Third Party Beneficiaries.* Except for the indemnification rights under this Agreement of any Parent Indemnitee or Subsidiary Indemnitee in their respective capacities as such, (a) the provisions of this Agreement and each Ancillary Agreement are solely for the benefit of the Parties and are not intended to confer upon any Person except the Parties any rights or remedies hereunder, and (b) there are no third party beneficiaries of this Agreement or any Ancillary Agreement and neither this Agreement nor any Ancillary Agreement shall provide any third party with any remedy, claim, liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement or any Ancillary Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) *Assignability.* The provisions of this Agreement, each Ancillary Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors and permitted transferees and assigns. Notwithstanding the foregoing, this Agreement shall not be assignable, in whole or in part, by any Party without the prior written consent of the other Party, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be null and void; provided, that a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets, and upon the effectiveness of such assignment the assigning Party shall be released from all of its obligations under this Agreement if the surviving entity of such merger or the transferee of such Assets shall agree in writing, in form and substance reasonably satisfactory to the other Party, to be bound by all terms of this Agreement as if named as a "Party" hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) *Certain Obligations.* Whenever this Agreement requires any of the Subsidiaries of any Party to take any action, this Agreement will be deemed to include an undertaking on the part of such Party to cause such Subsidiary to take such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) *Specific Performance.* The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled, in addition to any other remedy or relief to which they may be entitled, to injunctive relief (including provisional or temporary injunctive relief) to enforce specifically the terms and provisions hereof and enforcement of any such award of an arbitral tribunal in any court of the United States, or any other court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) *Severability.* If any provision of this Agreement or any Ancillary Agreement or the application thereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof or thereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby or thereby, as the case may be, is not affected in any manner adverse to any Party. Upon such determination, the Parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to effect the original intent of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) *Cooperation; Further Assurances*. The Parties will use good faith efforts to cooperate with each other in all matters relating to the provision of the Services. Each Party will take such actions as may be necessary or reasonably appropriate to implement or give effect to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) *Records; Confidentiality*. Each Party shall keep full and detailed records dealing with all aspects of the Services performed by it and shall provide access to the other Party to such records at all reasonable times. Each Party hereto shall keep, and shall cause its officer, directors, employees, accountants, counsel, investment bankers, financial advisors, consultants and other representatives ("**Representatives**") to keep the other Party's information, whether furnished orally or in writing or by any other means or gathered by inspection and regardless of whether the same is specifically marked or designated as "confidential" or "proprietary," together with any and all notes, memoranda, analyses, compilations, studies or other documents (whether in hard copy or electronic media) prepared by the receiving Party or any of its Representatives which contain or otherwise reflect such information, together with any and all copies, extracts or other reproductions of any of the same (the "**Information**"), strictly confidential and will disclose such Information only to such of its Representatives who need to know such Information, and who agree to be bound by this Section 9(m) and not to disclose such Information to any other person. Without the prior written consent of the other parties, neither Party nor any of its respective Representatives shall disclose the other Party's Information to any person or entity except as may be required by law or judicial process and in accordance with this Section 9(m). The term "**Information**" does not include information that: (i) is or becomes generally available to the public through no wrongful act of the receiving Party or its Representatives; (ii) is or becomes available to the receiving Party on a non-confidential basis from a source other than the providing Party or its Representatives, provided that such source is not known by the receiving Party to be subject to a confidentiality agreement with the providing Party; or (iii) has been independently acquired or developed by the receiving Party without violation of any of the obligations of the receiving Party or its Representatives under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) *Arbitration*. Any dispute with respect to this Agreement or any Transaction Document shall be arbitrated in Alameda County, California, in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. There will be a single neutral arbitrator selected who resides in Alameda County, California. The American Arbitration Association will provide a list of five (5) neutral arbitrators. The claimant and respondent will take turns, with the respondent going first, striking one name at a time from the list of five neutral arbitrators. Each Party will have no more than twenty-four (24) hours to take its turn striking the name of a neutral arbitrator. The final remaining arbitrator will serve as the neutral arbitrator. Either Party may apply to the arbitrator seeking injunctive relief until the arbitrator's award is rendered or the controversy is otherwise resolved. Either Party also may, without waiving any remedy under this Agreement or any Ancillary Agreement, seek from any California court having jurisdiction, any interim or provisional relief that is necessary to protect the rights and/or property of that Party, pending the determination of the arbitrator.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) Waiver of Jury Trial. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9(o).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) Waivers of Default. No action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any Party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) Survival of Covenants. Except as expressly set forth in any Ancillary Agreement, all covenants, representations, and warranties contained in this Agreement and each Ancillary Agreement, and liability for the breach of any obligations contained herein, shall survive after the Distribution Date and remain in full force and effect in accordance with their applicable terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) Expenses. Except as expressly set forth in this Agreement or in any Ancillary Agreement, whether or not the Separation or the Distribution is consummated, all third party fees, costs and expenses paid or incurred in connection with the Separation and Distribution shall be paid by Parent. All such fees, costs, and expenses so advanced shall be repaid by Subsidiary following the Distribution, pursuant to the terms and conditions negotiated by Parent and Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) Publicity. Prior to the Distribution, each of Subsidiary and Parent shall consult with each other prior to issuing any press releases or otherwise making public statements with respect to the Separation, the Distribution or any of the other transactions contemplated hereby and prior to making any filings with any Governmental Authority with respect thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) Tax Matters. Notwithstanding anything to the contrary in this Agreement, the rights and obligations of the Parties with respect to any and all tax matters shall be exclusively governed by the provisions of the Tax Matters Agreement, except as set forth therein.

[*Signature page follows*]

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers of the parties hereto as of the date first above written.

---

| | |
|:---|:---|
| ABVC BIOPHARMA, INC. | ABVC BIOPHARMA, INC. |
| By: | /s/ Uttam Patil |
| Name: | Uttam Patil |
| Title: | Chief Executive Officer |
| BIOKEY (CAYMAN), INC. | BIOKEY (CAYMAN), INC. |
| By: | /s/ T.S. Jiang |
| Name: | T.S. Jiang |
| Title: | Chief Executive Officer |

---

[*Signature Page to Transitional Services Agreement*]

**Exhibit A**

Services

1. **Accounting and Financial Services**: General accounting support, accounts payable and accounts receivable
processing, payroll administration, tax preparation and compliance, financial reporting and analysis, SEC reporting coordination, internal
and external audit support, budgeting and forecasting assistance, treasury and cash management services, and intercompany accounting and
reconciliation.

2. **Legal and Compliance Services**: General legal support, corporate governance and secretary services,
regulatory filings and compliance coordination, contract management and administration, intellectual property management, litigation support,
and insurance program administration.

3. **Investor Relations and Corporate Communications**: Shareholder communications, press release coordination,
investor inquiries and correspondence, annual and quarterly report preparation support, and corporate website maintenance.

4. **Information Technology Services**: IT infrastructure and network support, software licensing and
application support, data hosting and storage, cybersecurity and data protection services, email and communications systems, IT helpdesk
support, and technology migration assistance.

5. **Administrative and Operational Support**: Office space and facilities management (as applicable),
human resources and benefits administration, procurement and vendor management, records management and document retention, and general
administrative services.

6. **Regulatory Documentation and Quality Support**: Regulatory filing preparation and submission support
(as needed), quality assurance and quality control coordination, product documentation and labeling support, and regulatory agency correspondence
management.

7. **Transfer Agent and Shareholder Administration**: Transfer agent coordination, shareholder record
maintenance, stock plan administration support, and dividend and distribution processing support.

## Exhibit 10.2

**Exhibit 10.2**

**TAX MATTERS AGREEMENT**

This Tax Matters Agreement (the "**Agreement**") is dated as of [ ], 2026, between ABVC BioPharma, Inc., a Nevada corporation ("**Parent**"), and BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability and wholly owned subsidiary of Parent ("**Subsidiary**"). As used herein, Parent on the one hand, and Subsidiary, on the other hand, are sometimes referred to individually as a "**Party**", or together, as "**Parties**".

WHEREAS, prior to the Distribution, Subsidiary is a wholly owned subsidiary of Parent, and the Parties have entered into a Separation and Distribution Agreement, dated as of [ ], 2026 (the "**Separation Agreement**"), pursuant to which Parent and Subsidiary have agreed to effect the Separation;

WHEREAS, the Board of Directors of Parent has determined that it is in the best interests of Parent and its shareholders to partially separate the business of the Subsidiary from that of the Parent through the Separation;

WHEREAS, in furtherance of the foregoing, the Board of Directors of Parent has determined that it is in the best interests of Parent and its shareholders to distribute to the holders of the issued and outstanding shares of common stock of Parent (the "**Parent Common Stock**"), by means of a pro rata distribution, [ ]% of the ordinary shares of Subsidiary (the "**Subsidiary Ordinary Shares**") (the "**Distribution**"), with [ ]% of the Subsidiary Ordinary Shares to be retained by Parent;

WHEREAS, for United States federal income tax purposes, the Parties acknowledge and agree that the Distribution is not intended to qualify as a tax-free transaction under Section 355(a) of the Internal Revenue Code of 1986, as amended (the "**Code**"), and shall be treated as a taxable transaction;

WHEREAS, this Agreement, together with the Separation Agreement and the other Ancillary Agreements (as defined in the Separation Agreement), is intended to govern the rights and obligations of the Parties with respect to Tax matters; and

WHEREAS, the Parties desire to provide for and agree upon the allocation between the Parties of Liabilities for Taxes arising prior to, because of, and after Distribution, and to provide for and agree upon other matters relating to Taxes.

NOW, THEREFORE, the Parties agree as follows:

**<u>ARTICLE I</u>**

**<u>Definitions</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>Definitions</u>. As used in this Agreement, the following terms shall have the following respective meanings:

"Affiliate" of any Person shall mean another Person that directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with, such first Person; provided, however, that for the purposes of this Agreement, the Subsidiary Companies shall be treated as a separate group from the Parent Companies notwithstanding that Parent retains a controlling interest in Subsidiary following the Distribution.

"Ancillary Agreements" shall have the meaning ascribed to such term in the Separation Agreement.

"Code" shall have the meaning set forth in the Recitals hereto.

"Combined State Tax" means, with respect to each state or local Tax Authority, any income or franchise tax payable to such state or local Tax Authority in which any of the Subsidiary Companies files Tax Returns with any of the Parent Companies on a consolidated, combined or unitary basis for purposes of such income tax or franchise tax, including any related interest and any penalties, additions to such tax, or additional amounts imposed with respect thereto.

"Distribution" shall have the meaning set forth in the Recitals hereto.

"Distribution Date" shall mean the date on which the Distribution becomes effective.

"Equity Interests" means any stock or other securities treated as equity for Tax purposes, options, warrants, rights, convertible debt, or any other instrument or security that affords any Person the right, whether conditional or otherwise, to acquire stock or to be paid an amount determined by reference to the value of stock.

"Federal Income Tax" means any Tax imposed under Subtitle A of the Code and any related interest and any penalties, additions to such Tax, or additional amounts imposed with respect thereto.

"Final Determination" shall mean (i) with respect to Federal Income Taxes, a "determination" as defined in Section 1313(a) of the Code or execution of an Internal Revenue Service Form 870-AD and, with respect to taxes other than Federal Income Taxes, any decision, judgment, decree or other order by a court of competent jurisdiction that, under applicable law, is not subject to further appeal, review or modification through proceedings or otherwise; (ii) a closing agreement or accepted offer in compromise under Sections 7121 or 7122 of the Code, or a comparable agreement under the laws of a State, local, or foreign Tax Authority; (iii) the payment of Tax by any member of the Parent Consolidated Group with respect to any item disallowed or adjusted by a Tax Authority, provided that Parent determines that no action should be taken to recoup such payment; or (iv) any other final disposition, by mutual agreement of the Parties or by reason of the expiration of a statute of limitations or period for the filing of claims for refunds, amended returns, or appeals from adverse determinations.

"IRS" shall mean the United States Internal Revenue Service.

"Liabilities" shall mean any and all debts, liabilities, commitments and obligations, whether fixed, contingent or absolute, matured or unmatured, liquidated or unliquidated, accrued or not accrued, known or unknown, whenever or however arising and whether or not the same would be required by generally accepted accounting principles to be reflected in financial statements or disclosed in the notes thereto.

"Parent Businesses" shall mean all the businesses conducted at any time prior to the Distribution by Parent or its Subsidiaries which are not Subsidiary Businesses.

"Parent Common Stock" shall have the meaning set forth in the Recitals hereto.

"Parent Companies" shall mean Parent and its Subsidiaries (other than the Subsidiary Companies) after giving effect to the Distribution.

"Parent Consolidated Group" shall mean the affiliated group of corporations (within the meaning of Section 1504(a) of the Code) of which Parent is the common parent corporation and of which Subsidiary is or was a member, including during and after the Pre-Distribution Period, to the extent that Subsidiary continues to meet the requirements for inclusion in such group under Section 1504(a) of the Code following the Distribution.

"Person" shall mean any natural person, corporation, general or limited partnership, limited liability company, joint venture, trust, association or entity of any kind.

"Pre-Distribution Period" means any taxable year (or portion thereof) ending on or before the close of business on the Distribution Date.

"Separation Agreement" shall have the meaning set forth in the Recitals hereto.

"Separation Transactions" shall mean the Distribution and the other transactions contemplated by the Separation Agreement.

"Subsidiary Businesses" shall mean all of the businesses and operations of the Subsidiary as described in the Form 10 (as defined in the Separation Agreement).

"Subsidiary Companies" shall mean Subsidiary and its Subsidiaries determined after giving effect to the Distribution (and, for the avoidance of doubt, excluding Parent and any other Parent Companies, notwithstanding Parent's retained ownership interest in Subsidiary following the Distribution).

"Subsidiary Federal Income Tax Liability" shall mean, with respect to any taxable year (or portion thereof) in the Pre-Distribution Period, the sum of each of the Subsidiary Companies' Liabilities for Federal Income Taxes (except to the extent attributable to Parent's negligence) for such taxable year (or portion thereof), computed on a stand-alone basis as if such Subsidiary Company was not and never was part of the Parent Consolidated Group (provided, however, that transactions with the Parent Companies or between the Subsidiary Companies shall be reflected in such computation according to the provisions of the consolidated return regulations promulgated under the Code governing intercompany transactions), to the extent applicable. Such computation shall be made: (A) without regard to the income, deductions (including net operating loss and capital loss deductions) and credits in any taxable year of any of the Parent Companies, (B) with regard to net operating loss, capital loss and credit carryforwards and carrybacks from earlier taxable years of the Subsidiary Companies, (C) reflecting the positions, elections and accounting methods and periods used with respect to the Subsidiary Companies in preparing Parent's consolidated Federal Income Tax Returns and (D) in the case of a Subsidiary Company that is a disregarded entity, partnership or other flow-through entity for U.S. federal income tax purposes, by treating such entity as a separate entity subject to U.S. federal corporate income tax.

"Subsidiary State Tax Liability" shall mean with respect to any taxable year (or portion thereof) in the Pre-Distribution Period (i) in which the Parent Companies and any of the Subsidiary Companies filed a consolidated, unitary or combined state income tax or franchise Tax Return (a "Combined Return"), Subsidiary's share of the Combined State Taxes with respect to a Combined Return (except to the extent attributable to Parent's negligence), determined by taking the aggregate state income tax or franchise tax Liabilities of each of the Subsidiary Companies included in the Combined Return computed on a stand-alone basis over the total state income tax or franchise tax Liabilities of the Parent Consolidated Group with respect to such Combined Return, multiplied times the total state income tax or franchise tax Liability of the Parent Consolidated Group with respect to such Combined Return, and (ii) in which any of the Subsidiary Companies filed a Tax Return that was not a consolidated, unitary or combined state income tax or franchise Tax Return with the Parent Companies (a "Stand Alone Return"), the aggregate state income tax and franchise tax liability of such Subsidiary Companies with respect to such Stand Alone Return. In the case of any Subsidiary Company that is treated as a disregarded entity, partnership or other flow-through entity for state income or franchise tax purposes for any taxable year during the Pre-Distribution Period, such entity shall be treated as a separate entity subject to state income tax or franchise tax (as applicable) for purposes of computing the Subsidiary State Tax Liability for such taxable year.

"Straddle Period" shall mean any Tax Period that begins on or before and ends after the Distribution Date.

"Subsidiary" shall mean, with respect to any Person, any corporation or other organization, whether incorporated or unincorporated, of which (i) such Person or any other Subsidiary of such Person is a general partner or (ii) at least 50% of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other organization or 50% of the value of the outstanding equity is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries.

"Tax" or "Taxes" shall mean any federal, state, county, local or foreign taxes, charges, fees, levies or other assessments, including all net income, gross income, sales and use, ad valorem, transfer, gains, profits, excise, franchise, real and personal property, gross receipt, capital stock, share, production, business and occupation, disability, employment, payroll, license, estimated, stamp, custom duties, severance or withholding taxes or charges imposed by any governmental entity, and includes any interest and penalties (civil or criminal) on or additions to any such taxes.

"Tax Advisor" shall mean any Tax counsel or accountant of recognized national standing in the United States.

"Tax Asset" means any federal or state net operating loss, net capital loss, general business credit, foreign tax credit, charitable deduction, or any other loss, credit, deduction, or tax attribute which could reduce any Tax (including, without limitation, deductions, credits, alternative minimum net operating loss carryforwards related to alternative minimum taxes or additions to the basis of property).

"Tax Authority" shall mean, with respect to any Tax, the governmental authority or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such entity or subdivision.

"Tax Benefit" shall mean any reduction in Liability for Tax as a result of any loss, deduction, refund, credit or other item reducing Taxes otherwise payable.

"Tax Contest" shall mean an audit, review, examination, assessment or any other administrative or judicial proceeding with the purpose or effect of redetermining Taxes (including any administrative or judicial review of any claim for refund).

"Tax Law" shall mean the law of any governmental authority or political subdivision thereof relating to any Tax.

"Tax Period" shall mean, with respect to any Tax, the period for which the Tax is reported as provided under the Code or other applicable Tax Law.

"Tax Records" shall mean any Tax Returns, Tax Return workpapers, documentation relating to any Tax Contests and any other books of account or records (whether or not in written, electronic or other tangible or intangible forms and whether or not stored on electronic or any other media) required to be maintained under the Code or other applicable Tax Laws or under any record retention agreement with any Tax Authority.

"Tax Return" shall mean any report, return or other information required to be supplied to a governmental entity with respect to Taxes.

**<u>ARTICLE II</u>**

**<u>Tax Matters</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Assumption and Indemnification of Tax Liabilities</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subsidiary shall be liable for any unpaid Subsidiary Federal Income Tax Liability and Subsidiary State Tax Liability, whether arising before, at or after the Distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Parent shall be liable for all Tax Liabilities other than those described in Section 2.1(a) of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Party hereto agrees to save, indemnify, defend and hold harmless the other, its Subsidiaries and each of their respective directors, officers, employees, agents, successors and assigns from and against their respective Tax Liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Refunds</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If, with respect to any Tax for which the Subsidiary Companies are liable pursuant to this Agreement, Parent receives a refund, offset or credit, Parent shall remit to Subsidiary within thirty (30) days of receipt the amount of such refund, offset or credit, together with any interest received thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If, with respect to any Tax for which any of the Parent Companies are liable pursuant to this Agreement, Subsidiary receives a refund, offset or credit, Subsidiary shall remit to Parent within thirty (30) days of receipt the amount of such refund, offset or credit, together with any interest received thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any payments required to be made by Sections 2.3(a) or (b) of this Agreement shall be paid net of any Tax Liability and expenses incurred by a Party resulting from such Party's receipt of such refund from the Tax Authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Tax Returns/Cooperation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Parent shall prepare and file any Tax Return required to be filed with (1) the Internal Revenue Service with respect to the determination of the Federal Income Tax Liability of the Parent Consolidated Group, and (2) the appropriate Tax Authorities with respect to the determination of the Combined State Tax Liability of the Parent Consolidated Group. With respect to such return preparation, Parent shall not discriminate among any members of the Parent Consolidated Group. Parent shall have the right with respect to any such consolidated Federal Income Tax Returns or Combined State Tax Returns that it has filed or will file to determine (i) the manner in which such returns, documents or statements shall be prepared and filed, including, without limitation, the manner in which any item of income, gain, loss, deduction or credit shall be reported; (ii) whether any extensions should be requested; and (iii) the elections that will be made by any member of the Parent Consolidated Group. Each of the Subsidiary Companies hereby irrevocably appoints Parent as its agent and attorney-in-fact to take any action (including the execution of documents) Parent may deem necessary or appropriate to implement this Section 2.4.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) With respect to any other Tax Return, the Party that bears indemnification responsibility under this Article II shall be responsible for the preparation and filing of such Tax Return; provided, however, that in the preparation and filing of such Tax Return, such Party shall not take any position (or make any election) that is inconsistent with any position or election made by Parent in connection with the preparation and filing of any Tax Return required to be filed by Parent pursuant to Section 2.4(a) above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each of Parent and Subsidiary will, and will cause their respective personnel to, cooperate fully with each other in connection with the preparation and review of Tax Returns and in connection with any examinations of any Tax Returns by any Tax Authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 <u>Indemnification Procedures</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any claim for indemnification under this Article II shall be made by written notice from the Party seeking to be indemnified (the "**Tax Indemnitee**") to the Party from which indemnification is sought (the "**Tax Indemnifying Party**"). If a Tax Indemnitee becomes aware during an examination of a Tax Return that the Tax Authority conducting the examination is considering asserting a Tax subject to indemnification under this agreement, the Tax Indemnitee will (i) promptly notify the Tax Indemnifying Party of this fact, (ii) to the extent reasonably practicable, segregate the issue from any other issues being examined by the Tax Authority, (iii) permit the Tax Indemnifying Party to control the Tax examination insofar as it relates to that issue and any administrative or judicial appeals relating to the issue (including whether to settle the issue or to appeal from an adverse determination with regard to the issue) and (iv) cooperate with the Tax Indemnifying Party in all reasonable respects to establish that such Tax is not due and payable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon a determination that a Tax Indemnifying Party is liable for a payment of Taxes to a Tax Indemnitee, the Tax Indemnifying Party shall pay the Tax Indemnitee such Taxes. Such payment will be made on an after-Tax basis promptly following the submission by the Tax Indemnitee of written evidence of the payment of the indemnified Tax.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 <u>Sole Tax Sharing Agreement</u>. Any and all existing Tax sharing agreements or arrangements, written or unwritten, between any of the Parent Companies, on the one hand, and any of the Subsidiary Companies, on the other hand (other than this Agreement), if not previously terminated, shall be terminated as of the Distribution Date without any further action by the parties thereto. Following the Distribution, none of the Subsidiary Companies, on the one hand, and none of the Parent Companies, on the other hand, shall have any further rights or Liabilities thereunder, and this Agreement shall be the sole Tax sharing agreement between the Subsidiary Companies, on the one hand, and the Parent Companies, on the other hand. For the avoidance of doubt, nothing in this Section 2.6 shall affect the obligation of any Subsidiary Company to be included in the consolidated Federal Income Tax Return of the Parent Consolidated Group or any Combined Return to the extent required by applicable Tax Law for so long as Subsidiary remains a member of the Parent Consolidated Group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 [Reserved].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8 <u>Retention of Tax Records</u>. Each of Parent and Subsidiary and their respective Affiliates shall preserve and keep all Tax Records relating to Pre-Distribution Periods and Straddle Periods for so long as the contents thereof may become material in the administration of any matter under the Code or other applicable Tax Law, but in any event until the later of (a) the expiration of any applicable statutes of limitations (taking into account extensions), or (b) seven (7) years after the Distribution Date (such later date, the "**Retention Date**"). After the Retention Date, Parent and Subsidiary may dispose of such Tax Records upon ninety (90) days' prior written notice to the other Party. If, prior to the Retention Date, either Parent or Subsidiary reasonably determines that any Tax Records that it or its Affiliates would otherwise be required to preserve and keep under this Section 2.8 are no longer material in the administration of any matter under the Code or other applicable Tax Law, and the other Party agrees, then such first Party may dispose of such Tax Records upon ninety (90) days' prior notice to the other Party. Any notice of an intent to dispose given pursuant to this Section 2.8 shall include a list of the Tax Records to be disposed of describing in reasonable detail the files, books or other records being disposed of. The notified Party shall have the opportunity, at its cost and expense, to copy or remove, within such ninety (90) day period, all or any part of such Tax Records.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9 <u>Access to Tax Records</u>. Parent and Subsidiary and their respective Affiliates shall make available to each other for inspection and copying/scanning during normal business hours upon reasonable notice all Tax Records for Pre-Distribution Periods or Straddle Periods to the extent reasonably required by the other Party in connection with the preparation of financial accounting statements, audits, litigation or the resolution of items under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10 <u>Certain Covenants</u>. Each of Subsidiary and Parent shall not, and shall not permit any of their respective Subsidiaries to, take or fail to take any action in a manner that management of such Party knows, or should know, is reasonably likely to contravene any agreement with a Tax Authority entered into prior to the Distribution Date to which any member of the Subsidiary Companies or the Parent Companies is a party.

**<u>ARTICLE III</u>**

**<u>Miscellaneous</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Modification or Amendment</u>. No provision of this Agreement or any Ancillary Agreement may be amended or modified except by a written instrument signed by authorized officers of each of the Parties. No waiver by any Party of any provision hereof shall be effective unless explicitly set forth in writing and executed by the Party so waiving. The waiver by any Party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any other subsequent breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Entire Agreement; Counterparts</u>. This Agreement, the Separation Agreement and the other Ancillary Agreements, and all schedules and exhibits hereto and thereto, constitute the entire agreement between the Parties with respect to the subject matter hereof and thereof and supersede all prior negotiations, agreements, understandings and arrangements, both oral and written, between the Parties with respect to such subject matter. For the convenience of the Parties, this Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which shall together constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 <u>Governing Law</u>. This Agreement shall be governed by, and construed and interpreted in accordance with, the laws of the State of Nevada, without reference to its conflicts of law principles, as to all matters, including matters of validity, construction, effect, enforceability, performance and remedies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 <u>Notices</u>. Any notice, request or other document required or permitted to be given or delivered pursuant hereto shall be delivered in accordance with the notice provisions of the Separation Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 <u>Captions</u>. All Article, Section and paragraph captions herein are for convenience of reference only, do not constitute part of this Agreement and shall not be deemed to limit or otherwise affect any of the provisions hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 <u>No Third Party</u> Beneficiaries. Except for the indemnification rights under this Agreement of any Parent Company or Subsidiary Company in their respective capacities as such, (a) the provisions of this Agreement are solely for the benefit of the Parties hereto and are not intended to confer upon any Person, except the Parties hereto, any rights or remedies hereunder, and (b) there are no third party beneficiaries of this Agreement and this Agreement shall not provide any third person with any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing without reference to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 <u>Successors and Assigns</u>. No Party to this Agreement shall convey, assign or otherwise transfer any of its rights or obligations under this Agreement without the express written consent of the other Party in its sole and absolute discretion. Any such conveyance, assignment or transfer without the express written consent of the other Party shall be void ab initio. No assignment of this Agreement or any rights hereunder shall relieve the assigning Party of its obligations hereunder. Notwithstanding the foregoing, this Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns, and any successor or permitted assignee of any Party hereto shall be entitled to the rights and benefits of such Party under this Agreement. Any successor by merger or by acquisition of all or substantially all of the assets of a Party to this Agreement shall be substituted for such Party as a Party to this Agreement, and all obligations, duties and Liabilities of the substituted party under this Agreement shall continue in full force and effect as obligations, duties and Liabilities of the substituting Party, enforceable against the substituting party as a principal, as though no substitution had been made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 <u>Certain Obligations</u>. Whenever this Agreement requires any of the Subsidiaries of any Party to take any action, this Agreement will be deemed to include an undertaking on the part of such Party to cause such Subsidiary to take such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9 <u>Specific Performance</u>. Subject to the provisions of Section 3.11, in the event of any actual or threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the Party or Parties who are or are to be thereby aggrieved shall have the right of specific performance and injunctive relief giving effect to its or their rights under this Agreement, in addition to any and all other rights and remedies at law or in equity, and all such rights and remedies shall be cumulative. The Parties agree that the remedies at law for any breach or threatened breach, including monetary damages, are inadequate compensation for any loss and that any defense in any action for specific performance that a remedy at law would be adequate is hereby waived. Any requirements for the securing or posting of any bond or other security with such remedy are hereby waived.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10 <u>Severability</u>. If any provision of this Agreement or the application thereof to any Person or circumstance is determined to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances other than those remaining provisions hereof, or the application of such provision to Persons or circumstances other than those as to which it has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any Party. Upon any such determination, the Parties shall negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to effect the original intent of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.11 <u>Dispute Resolution</u>. Any dispute with respect to this Agreement shall be resolved in accordance with the dispute resolution provisions set forth in the Separation Agreement. Either Party may apply to any court of competent jurisdiction seeking injunctive relief pending the resolution of any such dispute. Either Party also may, without waiving any remedy under this Agreement or any Ancillary Agreement, seek from any court having jurisdiction any interim or provisional relief that is necessary to protect the rights and/or property of that Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.12 <u>Waiver of Jury Trial</u>. EACH PARTY HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 3.12.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.13 <u>Waivers of Default</u>. No failure or delay of any Party in exercising any right or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Parties hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.14 <u>Survival of Covenants</u>. Except as expressly set forth in this Agreement, the covenants, representations and warranties contained in this Agreement, and the Liabilities for the breach of any obligations contained herein, shall survive the Distribution and shall remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.15 <u>Expenses</u>. Except as otherwise expressly set forth in this Agreement, each Party shall bear its own fees, costs and expenses incurred in connection with the preparation of, or any amendment or waiver of any provision of, this Agreement and the consummation of the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.16 <u>Publicity</u>. Each Party shall consult with the other Party prior to issuing any press releases or otherwise making any public statements with respect to this Agreement or the transactions contemplated hereby, and no Party shall issue any such press release or make any such public statement without the prior written consent of the other Party, except as may be required by applicable law or by obligations pursuant to any listing agreement with any national securities exchange, in which case the Party proposing to issue such press release or make such public statement shall use commercially reasonable efforts to consult in good faith with the other Party before issuing any such press release or making any such public statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.17 <u>Arbitration</u>. Any dispute with respect to this Agreement or any Ancillary Agreement shall be arbitrated in Alameda County, California, in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. There will be a single neutral arbitrator selected who resides in Alameda County, California. The American Arbitration Association will provide a list of five (5) neutral arbitrators. The claimant and respondent will take turns, with the respondent going first, striking one name at a time from the list of five neutral arbitrators. Each Party will have no more than twenty-four (24) hours to take its turn striking the name of a neutral arbitrator. The final remaining arbitrator will serve as the neutral arbitrator. Either Party may apply to the arbitrator seeking injunctive relief until the arbitrator's award is rendered or the controversy is otherwise resolved. Either Party also may, without waiving any remedy under this Agreement or any Ancillary Agreement, seek from any California court having jurisdiction, any interim or provisional relief that is necessary to protect the rights and/or property of that Party, pending the determination of the arbitrator.

[*Signature Page Follows*]

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers of the Parties hereto as of the date first above written.

---

| | |
|:---|:---|
| ABVC BIOPHARMA, INC. | ABVC BIOPHARMA, INC. |
| By: | /s/ Uttam Patil |
| Name: | Uttam Patil |
| Title: | Chief Executive Officer |
| BIOKEY (CAYMAN), INC. | BIOKEY (CAYMAN), INC. |
| By: | /s/ T.S. Jiang |
| Name: | T.S. Jiang |
| Title: | Chief Executive Officer |

---

[*Signature Page to the Tax Matters Agreement*]

## Exhibit 10.3

**Exhibit 10.3**

**EMPLOYEE MATTERS AGREEMENT**

This EMPLOYEE MATTERS AGREEMENT, dated as of [ ], 2026 (this "**Agreement**"), is entered into by and among ABVC BioPharma, Inc., a Nevada corporation ("**Parent**"), and BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability and wholly owned subsidiary of Parent ("**Subsidiary**"). Each of Parent and Subsidiary is referred to herein as a "**Party**" and collectively as the "**Parties**." Capitalized terms used in this Agreement and not otherwise defined shall have the meanings ascribed to such terms in the Separation Agreement (as defined below).

**RECITALS** 

WHEREAS, pursuant to that certain Separation and Distribution Agreement (the "**Separation Agreement**") dated as of the date hereof, by and among Parent and Subsidiary, Parent and Subsidiary have set out the terms on which, and the conditions subject to which, they wish to implement the Separation and Distribution of Subsidiary; and

WHEREAS, as of the date hereof, Subsidiary has no Employees and has not previously employed any individuals, and all Employees whose services relate to the Subsidiary Business are currently employed by Parent or its Affiliates; and

WHEREAS, in connection with the foregoing, the Parties have entered into this Agreement to provide for the transfer of certain Employees from Parent to Subsidiary and to allocate, among Parent and Subsidiary, Assets, Liabilities and responsibilities with respect to certain employee compensation, benefits, labor and other employment matters, all pursuant to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

**ARTICLE I** 

**DEFINITIONS** 

Section 1.01 <u>Definitions</u>. As used in this Agreement, the following terms shall have the meanings indicated below:

"<u>Closing Plan Year</u>" means the calendar year in which the Effective Time occurs.

"<u>COBRA</u>" shall have the meaning specified in Section 2.03(d).

"<u>Code</u>" means the Internal Revenue Code of 1986, as amended.

"<u>Continuing Employee</u>" means each of Uttam Patil and each other Employee of Parent identified on Schedule 2 hereto who will continue as an Employee of Parent following the Distribution as determined by Parent prior to the Distribution, in each case, in their capacities as Employees of Parent. For the avoidance of doubt, an Employee shall be deemed a "**Continuing Employee**" if he or she is expected to serve as an Employee of both Parent and Subsidiary following the Distribution. A Continuing Employee who also serves as an Employee of Subsidiary shall, in his or her capacity as an Employee of Subsidiary, also be deemed a Subsidiary Employee.

"<u>Employee</u>" means with respect to any entity, an individual who is considered, according to the payroll and other records of such entity, to be employed by such entity, whether active or inactive, on disability leave, or on other leave of absence.

"<u>Employment Agreement</u>" means each individual employment, offer, retention, consulting, change in control, split dollar life insurance, sale bonus, incentive bonus, severance, restrictive covenant or other employment related or individual compensatory agreement between any current or former employee and Parent or any of its Affiliates (including Subsidiary), in each case, that is related to the Subsidiary Business, other than those between Parent and any Continuing Employee, in his or her capacity as an employee of Parent.

"<u>Employment Claim</u>" means any actual, threatened or potential lawsuit, arbitration, ERISA claim, or federal, state, or local judicial or administrative proceeding of whatever kind involving a demand by or on behalf of or relating to an employee, former employee, job applicant, intern or volunteer, independent contractor, leased employee, or anyone claiming to be an employee or joint employee, or by or relating to a collective bargaining agent of employees, or by or relating to any federal, state, or local government agency alleging liability against an entity as an employer or against an employee pension, welfare or other benefit plan, or an administrator, trustee or fiduciary thereof.

"<u>ERISA</u>" means the Employee Retirement Income Security Act of 1974, as amended.

"<u>Former Subsidiary Employee</u>" means each former Employee of Parent or its Affiliates identified on Schedule 3 hereto whose last employment with Parent or its Affiliates before the Effective Time was primarily related to the Subsidiary Business and not primarily related to the Parent Business.

"<u>IRS</u>" means the United States Internal Revenue Service.

"<u>Subsidiary</u>" has the meaning specified in the preamble of this Agreement.

<u>"Subsidiary Benefit Plans</u>" means any Plan that is sponsored or maintained by Subsidiary or a Subsidiary Entity.

<u>"Subsidiary Employee</u>" means each Employee of Parent identified on <u>Schedule 1</u> hereto who will be transferred to and become an Employee of Subsidiary or any member of the Subsidiary Group in connection with the Distribution, in each case, in his or her capacity as an Employee of Subsidiary. For the avoidance of doubt, a Continuing Employee who is expected to serve as an Employee of both Parent and Subsidiary following the Distribution shall be deemed a Subsidiary Employee solely in his or her capacity as an Employee of Subsidiary (and not in his or her capacity as an Employee of Parent).

"<u>Subsidiary Entity</u>" means any entity that is a direct or indirect subsidiary of Subsidiary.

"<u>Subsidiary Group</u>" means Subsidiary and each Subsidiary Entity.

<u>"Subsidiary FSAs</u>" has the meaning specified in Section 2.03(c).

<u>"Subsidiary Health and Welfare Benefit Plans</u>" has the meaning specified in Section 2.03(b).

<u>"Subsidiary Retirement Plan</u>" has the meaning specified in Section 2.02(b).

"<u>Parent</u>" has the meaning specified in the preamble of this Agreement.

"<u>Parent Benefit Plan</u>" means any of (i) the Parent Health and Welfare Benefit Plans, the Parent Retirement Plan, and (ii) any other Plan that, as of the close of business on the Business Day before the Effective Time, is sponsored or maintained solely by Parent or a Parent Group member.

"<u>Parent Entity</u>" means Parent and any entity that is a direct or indirect Subsidiary of Parent (other than Subsidiary and the other members of the Subsidiary Group).

"<u>Parent Group</u>" means Parent and each Parent Entity.

"<u>Parent FSAs</u>" has the meaning specified in Section 2.03(c).

"<u>Parent Health and Welfare Benefit Plans</u>" means the health and welfare plans sponsored and maintained by Parent or any of its Subsidiaries or Affiliates, including any flexible benefit plan.

"<u>Parent Retirement Plan</u>" means the ABVC BioPharma, Inc. 401(k) Plan, as in effect immediately prior to the Effective Time.

"<u>Party</u>" and "<u>Parties</u>" have the meanings specified in the preamble of this Agreement.

"<u>Plan</u>" means any plan, policy, arrangement, contract or agreement providing compensation or benefits for any group of Employees or individual Employee, or the dependents or beneficiaries of any such Employee(s), whether formal or informal or written or unwritten, and including, without limitation, any means, whether or not legally required, pursuant to which any benefit is provided by an employer to any Employee or the beneficiaries of any such Employee. The term "**Plan**" as used in this Agreement does not include any Contract relating to settlement of actual or potential Employment Claims. Notwithstanding the foregoing, no Employment Agreement will constitute a "**Plan**" for purposes hereof.

"<u>Plan Payee</u>" means an individual who is entitled to payment of Plan benefits in his or her capacity as a beneficiary with respect to the benefits of a deceased participant in the Plan or an alternate payee under a qualified domestic relations order within the meaning of Section 414(p)(1)(A) of the Code and Section 206(d)(3)(B)(i) of ERISA with respect to the benefits of a participant in the Plan.

"<u>Separation Agreement</u>" has the meaning specified in the recitals of this Agreement.

"<u>WARN</u>" has the meaning specified in Section 3.01.

"<u>Workers' Compensation Event</u>" means the event, injury, illness or condition giving rise to a workers' compensation claim.

Section 1.02 <u>Interpretation; Construction</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless the context of this Agreement otherwise requires: (i) words of any gender include each other gender and neuter form; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) derivative forms of defined terms will have correlative meanings; (iv) the terms "hereof," "herein," "hereby," "hereto," "herewith," "hereunder" and derivative or similar words refer to this entire Agreement; (v) the terms "Article," "Section," and "Schedule" refer to the specified Article, Section, or Schedule, as the case may be, of this Agreement and references to "paragraphs" or "clauses" shall be to separate paragraphs or clauses, respectively, of the section or subsection in this Agreement in which the reference occurs; (vi) the words "include," "includes" and "including" shall be deemed to be followed by the phrase "without limitation;" (vii) the word "or" shall be disjunctive but not exclusive; (viii) the phrase "to the extent" shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply "if;" and (ix) the terms "writing," "written" and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless the context of this Agreement otherwise requires: references to Contracts (including this Agreement) and other documents or Laws shall be deemed to include references to such Contract or Law as amended, restated, supplemented or modified from time to time in accordance with its terms and the terms hereof, as applicable, and in effect at any given time (and, in the case of any Law, to any successor provisions).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Unless the context of this Agreement otherwise requires, references to any federal, state, local, or foreign statute or Law shall include all regulations promulgated thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Unless the context of this Agreement otherwise requires, references to any Person include references to such Person's successors and permitted assigns, and in the case of any Governmental Authority, to any Person succeeding to its functions and capacities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent. The Parties acknowledge that each Party and its attorneys have reviewed and participated in the drafting of this Agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting Party, or any similar rule operating against the drafter of a Contract, shall not be applicable to the construction or interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. If any action is to be taken or given on or by a particular day, and such day is not a Business Day, then such action may be deferred until the next Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) All accounting terms used herein and not expressly defined herein shall have the meanings given to them under GAAP unless the context otherwise requires.

Section 1.03 <u>Survival</u>. If the Distribution is consummated, the obligations set forth in this Agreement shall remain in full force and effect and shall survive the Effective Time.

**ARTICLE II** 

**EMPLOYEES AND EMPLOYEE BENEFITS** 

Section 2.01 <u>Employment</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Transfer of Employment to Subsidiary</u>. At or prior to the Effective Time, Parent and Subsidiary shall take all steps necessary and appropriate to transfer, or cause to become effective, the employment of the Subsidiary Employees from Parent to Subsidiary or the applicable Subsidiary Entity. The Continuing Employees shall continue as Employees of Parent or the applicable Parent Entity following the Distribution. The Parties shall cooperate to effect any transfers of employment contemplated by this Section 2.01 in a manner that does not result in severance or termination payments or benefits becoming due to any affected Employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Continued Employment</u>. Between the date hereof and the Effective Time, neither Party shall, without the consent of the other Party, affirmatively terminate or cause its applicable Affiliate to affirmatively terminate, the employment of any Employees other than in the ordinary course of business and shall not transfer the employment of such Employees except as provided in Section 2.01(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Allocation of Responsibilities as Employer; Assumption of Employment-Related Liabilities</u>. At the Effective Time, Subsidiary or the applicable member of the Subsidiary Group shall assume responsibility as employer of the Subsidiary Employees. In addition, at the Effective Time, Subsidiary shall assume all Liabilities related to the employment or retention of Subsidiary Employees and Former Subsidiary Employees, except as specifically provided herein, including Liabilities for any Employment Claim with respect to a Subsidiary Employee or Former Subsidiary Employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Employment Agreements</u>. At or prior to the Effective Time, the Parties shall cause Subsidiary to enter into, assume, or otherwise become a party to, as applicable, Employment Agreements with or in respect of the Subsidiary Employees and to be solely and exclusively responsible for all obligations and Liabilities with respect thereto; provided, however, that employment agreements with Uttam Patil shall, as described in the Information Statement, be entered into following the Effective Time, subject to the approval of Subsidiary's Compensation Committee following the Distribution. On and after the Effective Time, Parent and its Affiliates (other than Subsidiary Entities) shall have no obligations or liabilities with respect to the Employment Agreements entered into or assumed by Subsidiary. To the extent an Employment Agreement to be entered into or assumed by Subsidiary is not executed or transferred in accordance with this Section 2.01(d), Subsidiary shall fully indemnify Parent and any applicable Parent Group member with respect to all Liabilities associated with such Employment Agreement (including any termination thereof) to the extent arising out of events occurring following the Effective Time. From and after the Effective Time, Subsidiary shall assume all Liabilities under and perform all obligations under all Subsidiary Benefit Plans.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Service Credit</u>. From and after the Effective Time, Subsidiary shall give each Subsidiary Employee full credit for determining the amount of paid time off, vacation or sick leave, and the level of employer contributions under any defined contribution retirement plan, and for purposes of eligibility to participate and vesting (but not benefit accruals (if applicable)) under any employee benefit plans, arrangements, collective agreements and employment-related entitlements (including under any applicable pension, defined contribution (for example, 401(k)), deferred compensation, savings, medical, dental, life insurance, disability, vacation, long-service leave or other leave entitlements, post-retirement health and life insurance, termination indemnity, severance or separation pay plans) provided, sponsored, maintained or by or contributed to Subsidiary or any of its Affiliates under which such Subsidiary Employee is eligible to participate after the Effective Time for such Subsidiary Employee's service with Parent, Subsidiary or their respective Subsidiaries prior to the Effective Time, to the same extent recognized by any of Parent, Subsidiary and their respective Subsidiaries immediately prior to the Effective Time, except to the extent such credit would result in the duplication of benefits for the same period of service.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Independent Contractors</u>. With respect to any independent contractor agreements or similar Contract with independent contractors that relate primarily to the Subsidiary Business and that are with Parent or a member of the Parent Group (and are not with Subsidiary or a Subsidiary Group member), the Parties shall use commercially reasonable efforts to assign the applicable Contract and related Liabilities to Subsidiary or a member of the Subsidiary Group or a Subsidiary Group member designated by Subsidiary. With respect to any independent contractor agreements or similar Contract with independent contractors that relate primarily to the Parent Business and that are with Subsidiary or a member of the Subsidiary Group (and not with Parent or a Parent Group member), the Parties shall use commercially reasonable efforts to assign the applicable Contract and related Liabilities to Parent or a Parent Group member designated by Parent.

Section 2.02 <u>Retirement Plans</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Parent Retirement Plan</u>. Effective on the Effective Time, Subsidiary Employees (other than those that are Continuing Employees) shall cease to be eligible to: (i) have elective deferrals contributed on their behalf to the Parent Retirement Plan with respect to pay paid after the Effective Time, (ii) be credited with future employer contributions (for example, matching contributions) in the Parent Retirement Plan, or (iii) make contributions (for example, rollovers or loan repayments) to the Parent Retirement Plan, and shall cease to be active participants in the Parent Retirement Plan. Effective on the Effective Time, each Subsidiary Group member shall cease to be a participating employer in the Parent Retirement Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Subsidiary Retirement Plan</u>. Prior to Effective Time, Subsidiary shall take all actions necessary or appropriate to establish or maintain for the benefit of Subsidiary Employees (i) a defined contribution plan qualified under Section 401(a) of the Code that includes a cash or deferred arrangement qualified under Section 401(k) of the Code that is a participant-directed individual account plan that complies with Section 404(c) of ERISA, and (ii) a related trust or trusts exempt under Section 501(a) of the Code, each to be effective no later than the Effective Time (such plan and trust(s), the "**Subsidiary Retirement Plan**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>401(k) Transfer of Assets and Liabilities</u>. Subsidiary shall cause each Subsidiary Employee who is covered under the Parent Retirement Plan immediately prior the Effective Time to be covered under the Subsidiary Retirement Plan immediately following the Effective Time. Parent shall cause to be transferred from the Parent Retirement Plan to the Subsidiary Retirement Plan the full cash value of the Subsidiary Employees' account balances under the Parent Retirement Plan as of the Effective Time (or in the case of Subsidiary Employees that are Continuing Employees, such portion of each such Continuing Employees' respective account balance under the Parent Retirement Plan as determined by the Continuing Employee), including any outstanding participant loans, and Subsidiary shall cause the Subsidiary Retirement Plan to accept such transfers. The transfers of assets and the related liabilities shall take place as soon as practicable following the Effective Time. Parent and the Parent Retirement Plan shall be relieved of the liability for the Subsidiary Employees' accounts under the Parent Retirement Plan following the transfer of assets and liabilities described in this paragraph (except with respect to any balance retained by the Parent with respect to a Continuing Employee).

Section 2.03 <u>Health and Welfare Benefits.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Parent Health and Welfare Benefit Plans</u>. Effective as of the Effective Time, Subsidiary Employees (other than those that are Continuing Employees, in their capacities as such) will cease to participate in the Parent Health and Welfare Benefit Plans and each member of the Subsidiary Group shall cease to be a participating employer in the Parent Health and Welfare Plans. The Parent Health and Welfare Benefit Plans shall continue to be responsible for the payments of any claims for benefits with respect to Subsidiary Employees that occur prior to the Effective Time to the extent such claims are covered under applicable insurance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Establishment of Subsidiary Health and Welfare Benefit Plans</u>. Prior to the Effective Time, Subsidiary shall or shall cause one of its Affiliates to take, or cause to be taken, or have taken, all action necessary and appropriate to establish or designate and administer a group welfare benefits plan for the benefit of all Subsidiary Employees effective as of the Effective Time (the "**Subsidiary Health and Welfare Benefit Plans**") and to provide benefits thereunder for all eligible Subsidiary Employees who choose to enroll in such Plans that are substantially comparable to those provided under the Parent Health and Welfare Benefit Plans as of the Effective Time. Subsidiary will cause such Subsidiary Health and Welfare Benefit Plans to cover those Subsidiary Employees and their dependents who immediately prior to the Effective Time were participating in, or entitled to present or future benefits under, the corresponding Parent Health and Welfare Benefit Plans. Except as otherwise provided in Section 2.03(a), Subsidiary will be responsible for all Liabilities associated with claims incurred prior to the Effective Time by Subsidiary Employees (other than Continuing Employees, in their capacities as Employees of Parent) and Former Subsidiary Employees and their dependents under the Parent Health and Welfare Benefit Plans, which are paid on or after the Effective Time, regardless of when such claims are incurred, filed and/or paid, and shall promptly reimburse Parent for any such amounts following receipt from Parent of adequate documentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Prior to the Effective Time, Subsidiary shall establish or designate a dependent care spending account and a medical care spending account (the "**Subsidiary FSAs**"). The Parties shall take all steps reasonably necessary or appropriate so that the account balances (positive or negative) under the dependent care spending account and a medical care spending account plans sponsored by Parent (the "**Parent FSAs**") of each Subsidiary Employee who has elected to participate therein in the year in which the Effective Time occurs shall be transferred on, or as soon as practicable after, the Effective Time from the Parent FSAs to the corresponding Subsidiary FSAs; provided that the account balances of each Subsidiary Employee who is also a Continuing Employee may be transferred in such amount as the applicable Continuing Employee may designate. The Subsidiary FSAs shall assume responsibility as of the Effective Time for all outstanding dependent care and medical care claims under the Parent FSAs of each Subsidiary Employee for the year in which the Effective Time occurs and shall assume the rights of and agree to perform the obligations of the analogous Parent FSA from and after the day following the date of the Effective Time, in each case, other than in respect of claims under the Parent FSAs of a Continuing Employee, in his or her capacity as an Employee of Parent. The Parties shall cooperate to provide that the contribution elections of each such Subsidiary Employee as in effect immediately before the Effective Time remain in effect under the Subsidiary FSAs following the Effective Time. As soon as practicable after the Effective Time, Parent shall transfer to Subsidiary an amount equal to the sum of (i) the total contributions made to the Parent FSAs by Subsidiary Employees who are not also Continuing Employees and (ii) the contributions made to the Parent FSAs by Subsidiary Employees who are also Continuing Employees in proportion to the percentage of their account balances are transferred to the Subsidiary FSAs, in the case of each of clauses (i) and (ii), in respect of the plan year in which the Effective Time occurs, reduced by an amount equal to the total claims already paid in respect of such plan year. From and after the Effective Time, Parent shall (subject to applicable Law) provide Subsidiary with such information as Subsidiary may reasonably request to enable it to verify any claims information pertaining to a Parent FSA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Continuation Coverage</u>. As of the Effective Time, Subsidiary and the Subsidiary Health and Welfare Benefit Plans shall assume or retain and shall be solely responsible for providing and meeting the continuation coverage requirements imposed by Section 4980B of the Code and Sections 601 through 608 of ERISA ("**COBRA**") or similar state law for all Subsidiary Employees (other than those that are also Continuing Employees, in their capacities as Employees of Parent) and all Former Subsidiary Employees, as well as their "qualified beneficiaries" (as defined under COBRA), regardless of whether such Liabilities arose before, on or after the Effective Time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>6055/6056 Reporting</u>. Subsidiary shall be solely responsible for ensuring that Subsidiary complies with the reporting obligations under Section 6056 of the Code (Reporting of Offers of Coverage) with respect to Subsidiary Employees for the Closing Plan Year (including while Subsidiary was owned by Parent) and periods after the Effective Time, for which Subsidiary has a reporting obligation, provided that Parent shall be responsible for complying with all reporting obligations with respect to the year prior to the Closing Plan Year. In this regard, Subsidiary shall be responsible for distributing IRS Form 1095-C to applicable individuals and filing IRS Forms 1094-C and 1095-C with the IRS, all according to the applicable rules and regulations governing such forms. Subsidiary shall also be solely responsible for ensuring that Subsidiary complies with the reporting obligations under Section 6055 of the Code (Reporting of Enrollment in Minimum Essential Coverage) with respect to all Subsidiary Employees who are enrolled in a self-insured medical plan under the Parent Health and Welfare Benefit Plans. Subsidiary may meet this obligation either through IRS Forms 1094-C and 1095-C or IRS Forms 1094-B and 1095-B, all in accordance with applicable rules and regulations. The reporting obligations under Section 6055 of the Code for Subsidiary Employees who are enrolled in a fully insured medical plan under the Parent Health and Welfare Benefit Plans shall be met by the applicable insurance carrier or HMO. Parent shall cooperate with Subsidiary to provide all necessary, pre-Effective Time information for Subsidiary to meet its reporting obligation, which information shall be complete and accurate (in all material respects) and timely provided to Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Credit for Benefits</u>. Subsidiary shall (i) waive for each Subsidiary Employee and his or her dependents, any waiting period provision, payment requirement to avoid a waiting period, pre-existing condition limitation, actively-at-work requirement and any other restriction that would prevent immediate or full participation under the Subsidiary Health and Welfare Benefit Plans to the extent such waiting period, pre-existing condition limitation, actively-at-work requirement or other restriction was satisfied by or would not have been applicable to such Subsidiary Employee or dependent under the terms of the welfare plans of Subsidiary and its Affiliates (including Parent) immediately prior to the Effective Time, and (ii) give full credit under the Subsidiary Health and Welfare Benefit Plans applicable to each Subsidiary Employee and his or her dependents for all co-payments and deductibles satisfied prior to the Effective Time in the Closing Plan Year, and for any lifetime maximums, as if there had been a single continuous employer.

Section 2.05 <u>Workers' Compensation</u>. Effective as of the Effective Time, Subsidiary will be solely responsible for all workers' compensation claims of Subsidiary Employees and Former Subsidiary Employees with respect to Workers' Compensation Events occurring on or following the Effective Time. Parent shall retain responsibility for all workers' compensation claims of Subsidiary Employees and Former Subsidiary Employees with respect to Workers' Compensation Events occurring prior to the Effective Time, including to the extent covered by a Parent workers' compensation insurance policy. The Parties shall cooperate with respect to any notification to appropriate governmental agencies of the disposition and the issuance of new, or the transfer of existing, workers' compensation insurance policies and contracts governing the handling of claims.

Section 2.06 <u>Vacation and Sick Pay Liabilities</u>. On and after the Effective Time, (i) Subsidiary shall provide the Subsidiary Employees with the same vested and unvested balances of vacation and sick leave as credited to the Subsidiary Employees on Parent's or its Affiliate's payroll system immediately prior to the Effective Time and (ii) Subsidiary shall continue to accrue vacation and sick leave in respect of each Subsidiary Employee according to Parent's accrual schedule as in effect immediately prior to the Effective Time.

Section 2.07 <u>Severance</u>. Effective as of the Effective Time, Subsidiary shall assume all severance obligations with respect to any Subsidiary Employee arising on or after the Effective Time. With respect to any Former Subsidiary Employee, Subsidiary shall assume all severance obligations under any Parent Benefit Plan to the extent such obligations have not been fully satisfied prior to the Effective Time.

Section 2.08 <u>Preservation of Right To Amend or Terminate Plans</u>. Except as otherwise expressly provided in this Agreement or the Separation Agreement, no provisions of this Agreement shall be construed as a limitation on the right of Parent or Subsidiary or any Affiliate thereof to amend any Plan or terminate its participation therein which Parent or Subsidiary or any Affiliate thereof would otherwise have under the terms of such Plan or otherwise, and no provision of this Agreement shall be construed to create a right in any Employee or former Employee, or dependent or beneficiary of such Employee or former Employee, or any Plan Payee under a Plan which such person would not otherwise have under the terms of the Plan itself.

Section 2.09 <u>No Right to Continued Employment or Engagement or Acceleration of Benefits</u>. Notwithstanding anything to the contrary set forth in this Agreement, no provision of this Agreement or the Separation Agreement shall be deemed to guarantee any employee, independent contractor or individual service provider continued employment or engagement (or any terms or benefits of employment or engagement) for any period of time or to grant any such person any rights as a third party beneficiary hereunder, including any right to any compensation or benefit whatsoever under any Parent Benefit Plan or Subsidiary Benefit Plan or otherwise.

Section 2.10 <u>Cash Incentives</u>. At the Effective Time, the participation by each Subsidiary Employee (other than those who are also Continuing Employees, in their capacities as Employees of Parent) in any cash annual bonus, commission, sign-on, retention, stay bonus, transaction bonus or similar plan or agreement of Parent or a Parent Group member shall end, and Subsidiary shall assume all Liabilities with respect to such cash incentives provided to such Subsidiary Employees.

Section 2.11 <u>Equity Awards and Plans</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Parent Equity Awards. The vesting of all outstanding equity awards (including stock options) granted under Parent's equity compensation plans shall accelerate in full as of the Effective Time. Parent shall be responsible for the compensation costs associated with such vesting acceleration and remain responsible for Parent's equity compensation plans and all obligations and Liabilities related thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Subsidiary Equity Compensation Plans</u>. On and after the Distribution Date, Subsidiary shall be solely responsible for its equity compensation plans and all awards granted thereunder, and, in each case, all obligations and Liabilities related thereto.

**ARTICLE III** 

**LABOR AND EMPLOYMENT MATTERS** 

Notwithstanding any other provision of this Agreement or any other agreement between Subsidiary and Parent to the contrary, the Parties understand and agree as follows:

Section 3.01 <u>WARN Obligations</u>. Before and after the Effective Time, each Party shall comply in all material respects with the Worker Adjustment and Retraining Notification Act and similar state and local laws ("**WARN**"). As of the Effective Time, Subsidiary and its Affiliates shall be responsible for all obligations and liabilities under WARN relating to the Subsidiary Employees arising from mass layoffs or plant closings (each as defined under WARN) occurring on or after the Effective Time, and Parent shall be responsible for all obligations and liabilities under WARN arising from mass layoff or plant closings (each as defined under WARN) occurring prior to the Effective Time.

Section 3.02 <u>Last Payroll; Payroll Taxes and Reporting</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the applicable Parent Group member's first ordinary payroll date occurring on or after the Effective Time, Parent shall cause to be paid to all Subsidiary Employees all unpaid wages and other compensation due and payable through the Effective Time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Parent and Subsidiary (i) shall, to the extent practicable, treat Subsidiary (or a Subsidiary Group member designated by Subsidiary) as a "successor employer" and Parent (or the appropriate Parent Group member) as a "predecessor," within the meaning of Sections 3121(a)(1) and 3306(b)(1) of the Code, with respect to Subsidiary Employees for purposes of taxes imposed under the United States Federal Unemployment Tax Act or the United States Federal Insurance Contributions Act, and (ii) hereby agree to use commercially reasonable efforts to implement the alternate procedure described in Section 5 of Revenue Procedure 2004-53. Without limiting in any manner the obligations and Liabilities of the Parties under the Tax Matters Agreement, Subsidiary and each Subsidiary Group member shall bear its responsibility for payroll tax obligations and for the proper reporting to the appropriate governmental authorities of compensation of Subsidiary Employees earned after the Effective Time.

**ARTICLE IV** 

**OTHER MATTERS** 

Section 4.01 <u>Sharing of Information; Audit Rights with Respect to Information Provided; Privilege</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to applicable Law, Parent and Subsidiary shall share, and shall cause each member of its respective Group to reasonably cooperate with the other Party hereto to (i) share, with each other and their respective agents and vendors all participant information reasonably necessary for the efficient and accurate administration of each of the Parent Benefit Plans and the Subsidiary Benefit Plans, (ii) facilitate the transactions and activities contemplated by this Agreement and (iii) resolve any and all employment-related claims regarding Employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each of Parent and Subsidiary, and their duly authorized representatives, shall have the right to conduct reasonable audits with respect to all information provided to it by the other Party. The Parties shall cooperate to determine the procedures and guidelines for conducting audits under this Section 4.01, which shall require reasonable advance written notice by the auditing Party. The auditing Party shall have the right to make copies of any records at its expense, subject to applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The foregoing paragraphs (a) and (b) and the other provisions herein requiring the Parties to cooperate shall not be deemed to be a waiver of the attorney-client privilege for the Parties nor shall it require the Parties to waive their attorney-client privilege. In the event of any conflict between the applicable terms of the Separation Agreement and the terms of this Agreement with respect to matters relating to attorney-client privilege, the work product doctrine and all other evidentiary privileges and nondisclosure doctrines, the applicable terms of the Separation Agreement, as applicable (including Section 6.8 of the Separation Agreement), shall prevail.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The parties hereby agree that the confidentiality provisions of the Separation Agreement shall apply to all information and material furnished by either Party or its representatives hereunder to the other Party or any of its representatives, including, without limitation, any information shared pursuant to this Section 4.01.

Section 4.02 <u>Fiduciary Matters</u>. Each of Parent and Subsidiary acknowledge that actions required to be taken pursuant to this Agreement may be subject to fiduciary duties or standards of conduct under ERISA or other applicable Law, and no Party shall be deemed to be in violation of this Agreement if it fails to comply with any provisions hereof based upon its good faith determination (as supported by advice from counsel experienced in such matters) that to do so would violate such a fiduciary duty or standard. Each Party shall be responsible for taking such actions as are reasonably deemed necessary and appropriate to comply with its own fiduciary responsibilities and shall release and indemnify the other Party for any Liabilities caused by the failure to satisfy any such responsibility.

Section 4.03 <u>Consent of Third Parties</u>. If any provision of this Agreement is dependent on the consent of any Third Party (including any Governmental Authority) and such consent is withheld, Parent and Subsidiary shall use commercially reasonable efforts to implement the applicable provisions of this Agreement to the full extent practicable. If any provision of this Agreement cannot be so implemented due to the failure of such Third Party to consent, Parent and Subsidiary shall negotiate in good faith to implement the provision in a mutually satisfactory manner. The phrase "commercially reasonable efforts" as used herein shall not be construed to require the incurrence of any non-routine or unreasonable expense or Liability or the waiver of any right.

Section 4.04 <u>Reimbursement</u>. From time to time after the Effective Time, the Parties shall promptly reimburse one another, upon reasonable request of the Party requesting reimbursement and the presentation by such Party of such substantiating documentation as the other Party shall reasonably request, for the cost of any Liabilities satisfied or assumed by the Party requesting reimbursement or its Affiliates that are made, pursuant to this Agreement, the responsibility of the other Party or any of its Affiliates.

**ARTICLE V** 

**MISCELLANEOUS** 

Section 5.01 <u>Counterparts; Entire Agreement</u>.

(a) This Agreement may be executed in separate counterparts, each such counterpart being deemed to be an original instrument, and which counterparts shall together constitute the same agreement.

(b) This Agreement, the Separation Agreement and the other Ancillary Agreements and the Exhibits and Schedules hereto and thereto contain the entire agreement between the Parties with respect to the subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter, and there are no agreements or understandings between the Parties other than those set forth or referred to herein or therein. In the event of any conflict between the terms and conditions of the Separation Agreement and the terms and conditions of this Agreement, the terms and conditions of the Separation Agreement (including amendments thereto) shall control, except as otherwise expressly provided herein.

Section 5.02 <u>Governing Law</u>. This Agreement, except as expressly provided herein, shall be governed by and construed and interpreted in accordance with the laws of the State of Nevada, irrespective of the choice of laws principles of the State of Nevada as to all matters, including matters of validity, construction, effect, enforceability, performance, and remedies.

Section 5.03 <u>Tax Matters</u>. Notwithstanding anything to the contrary in this Agreement, the rights and obligations of the Parties with respect to any and all tax matters shall be exclusively governed by the provisions of the Tax Matters Agreement, except as set forth therein.

Section 5.04 <u>Assignability. The provisions of</u> this Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors and permitted transferees and assigns. Notwithstanding the foregoing, this Agreement shall not be assignable, in whole or in part, by any Party without the prior written consent of the other Party, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be null and void; provided, that a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets, and upon the effectiveness of such assignment the assigning Party shall be released from all of its obligations under this Agreement if the surviving entity of such merger or the transferee of such Assets shall agree in writing, in form and substance reasonably satisfactory to the other Party, to be bound by all terms of this Agreement as if named as a "Party" hereto.

Section 5.05 <u>Third Party Beneficiaries</u>. Except for the indemnification rights under this Agreement of any Parent Indemnitee or Subsidiary Indemnitee in their respective capacities as such, (a) the provisions of this Agreement are solely for the benefit of the Parties and are not intended to confer upon any Person except the Parties any rights or remedies hereunder, and (b) there are no third party beneficiaries of this Agreement and this Agreement shall not provide any third party with any remedy, claim, liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement.

Section 5.06 <u>Notices</u>. Any notice, request or other document required or permitted to be given or delivered pursuant hereto shall be delivered in accordance with the notice provisions of the Separation Agreement.

Section 5.07 <u>Severability</u>. If any provision of this Agreement or the application thereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any Party. Upon such determination, the Parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to affect the original intent of the Parties.

Section 5.08 <u>Publicity</u>. Prior to the Distribution, each of Subsidiary and Parent shall consult with each other prior to issuing any press releases or otherwise making public statements with respect to the Separation, the Distribution or any of the other transactions contemplated hereby and prior to making any filings with any Governmental Authority with respect thereto.

Section 5.09 <u>Expenses</u>. Except as expressly set forth in this Agreement or in the Separation Agreement, whether or not the Separation or the Distribution is consummated, all third party fees, costs and expenses paid or incurred in connection with the Separation and Distribution shall be paid by the Parent. All such fees, costs, and expenses so advanced shall be repaid by Subsidiary following the Distribution, pursuant to the terms and conditions negotiated by the Parent and the Subsidiary.

Section 5.10 <u>Headings</u>. The article, section and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

Section 5.11 <u>Survival of Covenants</u>. Except as expressly set forth in the Separation Agreement or any Ancillary Agreement, all covenants, representations, and warranties contained in this Agreement, and liability for the breach of any obligations contained herein, shall survive after the Distribution Date and remain in full force and effect in accordance with their applicable terms.

Section 5.12 <u>Waivers of Default</u>. No action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any Party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

Section 5.13 <u>Specific Performance</u>. The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled, in addition to any other remedy or relief to which they may be entitled, to injunctive relief (including provisional or temporary injunctive relief) to enforce specifically the terms and provisions hereof and enforcement of any such award of an arbitral tribunal in any court of the United States, or any other any court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction.

Section 5.14 <u>Amendments</u>. This Agreement may not be modified or amended except by an agreement in writing signed by each of the Parties.

Section 5.15 <u>Waiver of Jury Trial</u>. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.15.

Section 5.16 <u>Arbitration</u>. Any dispute with respect to this Agreement or any Ancillary Agreement shall be arbitrated in Alameda County, California, in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. There will be a single neutral arbitrator selected who resides in Alameda County, California. The American Arbitration Association will provide a list of five (5) neutral arbitrators. The claimant and respondent will take turns, with the respondent going first, striking one name at a time from the list of five neutral arbitrators. Each Party will have no more than twenty-four (24) hours to take its turn striking the name of a neutral arbitrator. The final remaining arbitrator will serve as the neutral arbitrator. Either Party may apply to the arbitrator seeking injunctive relief until the arbitrator's award is rendered or the controversy is otherwise resolved. Either Party also may, without waiving any remedy under this Agreement or any Ancillary Agreement, seek from any California court having jurisdiction, any interim or provisional relief that is necessary to protect the rights and/or property of that Party, pending the determination of the arbitrator.

[*Signature Page Follows*]

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed on the date first written above by their respective duly authorized officers.

---

| | |
|:---|:---|
| ABVC BIOPHARMA, INC. | ABVC BIOPHARMA, INC. |
| By: |  |
| Name: | Uttam Patil |
| Title: | Chief Executive Officer |
| BIOKEY (CAYMAN), INC. | BIOKEY (CAYMAN), INC. |
| By: |  |
| Name: | T.S. Jiang |
| Title: | Chief Executive Officer |

---

**SCHEDULE 1**

**Subsidiary Employees**

None.

**SCHEDULE 2**

**Continuing Employees**

Not applicable.

**SCHEDULE 3**

**Former Subsidiary Employees**

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Current Title at Parent** | **Expected Title at Subsidiary** | **Primary Work Location** |
| **EUGENE JIANG** | CBO / Chairman | CFO | Fremont, CA |
| **TSUNG SHANN JIANG** | CSO / Board Member | CEO | Fremont, CA |
| **UTTAM PATIL** | CEO | CSO | TAIWAN |

---

## Exhibit 10.4

**Exhibit 10.4**

**FORM OF INDEMNIFICATION AGREEMENT**

This Indemnification Agreement (this "**Agreement**"), dated as of [ ], 2026, is made by and between BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability (the "**Company**"), and **[ ]** (the "**Indemnitee**").

WHEREAS, the Indemnitee is a director and/or officer of the Company, or the Company expects the Indemnitee to join the Company as a director and/or officer;

WHEREAS, both the Company and the Indemnitee recognize the increased risk of litigation and other claims being asserted against directors and officers of public companies;

WHEREAS, the board of directors of the Company (the "**Board**") has determined that enhancing the ability of the Company to retain and attract as directors and officers the most capable persons is in the best interests of the Company and that the Company therefore should seek to assure such persons that indemnification and insurance coverage is available; and

WHEREAS, in recognition of the need to provide the Indemnitee with substantial protection against personal liability, in order to procure the Indemnitee's service as a director and/or officer of the Company and to enhance the Indemnitee's ability to serve the Company in an effective manner, and in order to provide such protection pursuant to express contract rights (intended to be enforceable irrespective of, among other things, any amendment to the Company's Memorandum of Association or Articles of Association (each as may be amended from time to time, together, the "**Constituent Documents**"), any change in the composition of the Board, or any Change in Control or business combination transaction relating to the Company), the Company wishes to provide in this Agreement for the indemnification of, and the advancement of Expenses (as defined below) to, the Indemnitee as set forth in this Agreement and to the extent insurance is maintained for the continued coverage of the Indemnitee under the Company's directors' and officers' liability insurance policies.

NOW, THEREFORE, in consideration of the foregoing and the Indemnitee's agreement to provide services to the Company, the parties agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Definitions</u>. For purposes of this Agreement, the following terms shall have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "<u>Beneficial Owner</u>" has the meaning given to the term "beneficial owner" in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "**Exchange Act**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "<u>Change in Control</u>" means the occurrence after the date of this Agreement of any of the following events:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing 50% or more of the Company's then outstanding Voting Securities unless the change in relative Beneficial Ownership of the Company's securities by any Person results solely from a reduction in the aggregate number of outstanding shares of securities entitled to vote generally in the election of directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the consummation of a reorganization, merger or consolidation, unless immediately following such reorganization, merger or consolidation, all the Beneficial Owners of the Voting Securities of the Company immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the combined voting power of the outstanding Voting Securities of the entity resulting from such transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) during any period of two consecutive years, not including any period prior to the execution of this Agreement, individuals who at the beginning of such period constituted the Board (including for this purpose any new directors whose election by the Board or nomination for election by the Company's stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved) cease for any reason to constitute at least a majority of the Board; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the stockholders of the Company approve a plan for complete liquidation or dissolution of the Company or an agreement for the sale or disposition by the Company of all or substantially all the Company's assets;

*provided*, *however*, that a distribution (or series of distributions) by ABVC BioPharma, Inc. to its shareholders of Ordinary Shares of the Company, on a pro rata basis, shall not be deemed to be a Change in Control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "<u>Claim</u>" means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any threatened, pending or completed action, suit, proceeding or alternative dispute resolution mechanism, whether civil, criminal, administrative, arbitrative, investigative or other, and whether made pursuant to federal, state, or other law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any inquiry, hearing, or investigation that the Indemnitee determines might lead to the institution of any such action, suit, proceeding or alternative dispute resolution mechanism.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>"Nevada Court</u>" has the meaning ascribed to it in <u>Section 9(e)</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) "<u>Disinterested Director</u>" means a director of the Company who is not and was not a party to the Claim in respect of which indemnification is sought by the Indemnitee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) "<u>Expenses</u>" means any and all expenses, including attorneys' and experts' fees, court costs, transcript costs, travel expenses, duplicating, printing and binding costs, telephone charges, and all other costs and expenses incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness or participate in, any Claim. Expenses shall also include (i) Expenses incurred in connection with any appeal resulting from any Claim, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of <u>Section 5</u> hereof only, Expenses incurred by the Indemnitee in connection with the interpretation, enforcement or defense of the Indemnitee's rights under this Agreement, by litigation or otherwise. Expenses, however, shall not include amounts paid in settlement by the Indemnitee or the amount of judgments or fines against the Indemnitee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) "<u>Expense Advance</u>" means any payment of Expenses advanced to the Indemnitee by the Company pursuant to <u>Section 4</u> or <u>Section 5</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) "<u>Indemnifiable Event</u>" means any event or occurrence, whether occurring before, on or after the date of this Agreement, related to the fact that the Indemnitee is or was a director, officer, employee or agent of the Company or any subsidiary of the Company, or is or was serving at the request of the Company as a director, officer, employee, member, manager, trustee or agent of any other corporation, limited liability company, partnership, joint venture, trust or other entity or enterprise (collectively with the Company, "**Enterprise**") or by reason of an action or inaction by the Indemnitee in any such capacity (whether or not serving in such capacity at the time any Loss is incurred for which indemnification can be provided under this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) "<u>Independent Counsel</u>" means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently performs, nor in the past three years has performed, services for either: (i) the Company or the Indemnitee (other than in connection with matters concerning the Indemnitee under this Agreement or of other indemnitees under similar agreements) or (ii) any other party to the Claim giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or the Indemnitee in an action to determine the Indemnitee's rights under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) "<u>Losses</u>" means any and all Expenses, damages, losses, liabilities, judgments, fines, penalties (whether civil, criminal or other), ERISA excise taxes, amounts paid or payable in settlement, including any interest, assessments, any federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement, and all other charges paid or payable in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness or participate in, any Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) "<u>Person</u>" means any individual, corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, governmental entity, or other entity, and includes the meaning set forth in Sections 13(d) and 14(d) of the Exchange Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) "<u>Standard of Conduct Determination</u>" has the meaning ascribed to it in <u>Section 9(b)</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) "<u>Voting Securities</u>" means any securities of the Company that vote generally in the election of directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Services to the Company</u>. The Indemnitee agrees to serve (or continue to serve as applicable) as a director and/or officer of the Company for so long as the Indemnitee is duly elected or appointed or until the Indemnitee tenders his or her resignation or is no longer serving in such capacity. This Agreement shall not be deemed an employment agreement between the Company (or any of its subsidiaries or Enterprise) and the Indemnitee. The Indemnitee specifically acknowledges that his or her employment with or service to the Company or any of its subsidiaries or Enterprise is at will and the Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment agreement between the Indemnitee and the Company (or any of its subsidiaries or Enterprise), other applicable formal severance policies duly adopted by the Board or, with respect to service as a director and/or officer of the Company, by the Company's Constituent Documents or applicable law. This Agreement shall continue in force after the Indemnitee has ceased to serve as a director and/or officer of the Company or, at the request of the Company, of any of its subsidiaries or Enterprise, as provided in <u>Section 12</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Indemnification</u>. Subject to <u>Sections 9</u> and <u>10</u> hereof, the Company shall indemnify the Indemnitee, to the fullest extent permitted by applicable law in effect on the date hereof, or as such law may from time to time hereafter be amended to increase the scope of such permitted indemnification, against any and all Losses if the Indemnitee was or is or becomes a party to or participant in, or is threatened to be made a party to or participant in, any Claim by reason of or arising in part out of an Indemnifiable Event, including, without limitation, Claims brought by or in the right of the Company, Claims brought by third parties, and Claims in which the Indemnitee is solely a witness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Advancement of Expenses</u>. The Indemnitee shall have the right to advancement by the Company, prior to the final disposition of any Claim by final adjudication to which there are no further rights of appeal, of all Expenses actually and reasonably paid or incurred by the Indemnitee in connection with any Claim arising out of an Indemnifiable Event. The Indemnitee's right to such advancement is not subject to the satisfaction of any standard of conduct. Without limiting the generality or effect of the foregoing, within 60 days after any request by the Indemnitee, the Company shall, in accordance with such request, (a) pay such Expenses on behalf of the Indemnitee, (b) advance to the Indemnitee funds in an amount sufficient to pay such Expenses, or (c) reimburse the Indemnitee for such Expenses. In connection with any request for Expense Advances, the Indemnitee shall not be required to provide any documentation or information to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. In connection with any request for Expense Advances, the Indemnitee shall execute and deliver to the Company an undertaking (which shall be accepted without reference to the Indemnitee's ability to repay the Expense Advances) to repay any amounts paid, advanced, or reimbursed by the Company for such Expenses to the extent that it is ultimately determined, following the final disposition of such Claim, that the Indemnitee is not entitled to indemnification hereunder. The Indemnitee's obligation to reimburse the Company for Expense Advances shall be unsecured and no interest shall be charged thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Indemnification for Expenses in Enforcing Rights</u>. To the fullest extent allowable under applicable law, the Company shall also indemnify against, and, if requested by the Indemnitee, shall advance to the Indemnitee subject to and in accordance with <u>Section 4</u> hereof, any Expenses actually and reasonably paid or incurred by the Indemnitee in connection with any action or proceeding by the Indemnitee for (a) indemnification or reimbursement or advance payment of Expenses by the Company under any provision of this Agreement, or under any other agreement or provision of the Constituent Documents now or hereafter in effect relating to Claims relating to Indemnifiable Events, and/or (b) recovery under any directors' and officers' liability insurance policies maintained by the Company, regardless of whether the Indemnitee ultimately is determined to be entitled to such indemnification or insurance recovery, as the case may be. The Indemnitee shall be required to reimburse the Company in the event that a final judicial determination is made that such action brought by the Indemnitee was frivolous or not made in good faith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Partial Indemnity</u>. If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of any Losses in respect of a Claim related to an Indemnifiable Event but not for the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion thereof to which the Indemnitee is entitled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Notification and Defense of Claims</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notification of Claims</u>. The Indemnitee shall notify the Company in writing as soon as practicable of any Claim which could relate to an Indemnifiable Event or for which the Indemnitee could seek Expense Advances, including a brief description (based upon information then available to the Indemnitee) of the nature of, and the facts underlying, such Claim. The failure by the Indemnitee to timely notify the Company hereunder shall not relieve the Company from any liability hereunder, unless the Company's ability to participate in the defense of such claim was materially and adversely affected by such failure/except that the Company shall not be liable to indemnify the Indemnitee under this Agreement with respect to any judicial award in a Claim related to an Indemnifiable Event if the Company was not given a reasonable and timely opportunity to participate at its expense in the defense of such action. If at the time of the receipt of such notice, the Company has directors' and officers' liability insurance in effect under which coverage for Claims related to Indemnifiable Events is potentially available, the Company shall give prompt written notice to the applicable insurers in accordance with the procedures set forth in the applicable policies. The Company shall provide to the Indemnitee a copy of such notice delivered to the applicable insurers, and copies of all subsequent correspondence between the Company and such insurers regarding the Claim, in each case substantially concurrently with the delivery or receipt thereof by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Defense of Claims</u>. The Company shall be entitled to participate in the defense of any Claim relating to an Indemnifiable Event at its own expense and, except as otherwise provided below, to the extent the Company so wishes, it may assume the defense thereof with counsel reasonably satisfactory to the Indemnitee. After notice from the Company to the Indemnitee of its election to assume the defense of any such Claim, the Company shall not be liable to the Indemnitee under this Agreement or otherwise for any Expenses subsequently directly incurred by the Indemnitee in connection with the Indemnitee's defense of such Claim other than reasonable costs of investigation or as otherwise provided below. The Indemnitee shall have the right to employ its own legal counsel in such Claim, but all Expenses related to such counsel incurred after notice from the Company of its assumption of the defense shall be at the Indemnitee's own expense; *provided*, *however*, that if (i) the Indemnitee's employment of its own legal counsel has been authorized by the Company, (ii) the Indemnitee has reasonably determined that there may be a conflict of interest between the Indemnitee and the Company in the defense of such Claim, (iii) after a Change in Control, the Indemnitee's employment of its own counsel has been approved by the Independent Counsel, or (iv) the Company shall not in fact have employed counsel to assume the defense of such Claim, then the Indemnitee shall be entitled to retain its own separate counsel (but not more than one law firm plus, if applicable, local counsel in respect of any such Claim) and all Expenses related to such separate counsel shall be borne by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Procedure upon Application for Indemnification</u>. In order to obtain indemnification pursuant to this Agreement, the Indemnitee shall submit to the Company a written request therefor, including in such request such documentation and information as is reasonably available to the Indemnitee and is reasonably necessary to determine whether and to what extent the Indemnitee is entitled to indemnification following the final disposition of the Claim; provided, that documentation and information need not be so provided to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. Indemnification shall be made insofar as the Company determines the Indemnitee is entitled to indemnification in accordance with <u>Section 9</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Determination of Right to Indemnification</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Mandatory Indemnification; Indemnification as a Witness</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To the extent that the Indemnitee shall have been successful on the merits or otherwise in defense of any Claim relating to an Indemnifiable Event or any portion thereof or in defense of any issue or matter therein, including without limitation dismissal without prejudice, the Indemnitee shall be indemnified against all Losses relating to such Claim in accordance with <u>Section 3</u> hereof to the fullest extent allowable by law, and no Standard of Conduct Determination shall be required.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To the extent that the Indemnitee's involvement in a Claim relating to an Indemnifiable Event is to prepare to serve and serve as a witness, and not as a party, the Indemnitee shall be indemnified against all Losses incurred in connection therewith to the fullest extent allowable by law and no Standard of Conduct Determination shall be required.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Standard of Conduct</u>. To the extent that the provisions of <u>Section 9(a)</u> above are inapplicable to a Claim related to an Indemnifiable Event that shall have been finally disposed of, any determination of whether the Indemnitee has satisfied any applicable standard of conduct under applicable law that is a legally required condition to indemnification of the Indemnitee hereunder against Losses relating to such Claim and any determination that Expense Advances must be repaid to the Company (a "**Standard of Conduct Determination**") shall be made as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) if no Change in Control has occurred, (A) by a majority vote of the Disinterested Directors, even if less than a quorum of the Board, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum, or (C) if there are no such Disinterested Directors, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to the Indemnitee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if a Change in Control shall have occurred, (A) if the Indemnitee so requests in writing, by a majority vote of the Disinterested Directors, even if less than a quorum of the Board, or (B) otherwise, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to the Indemnitee.

The Company shall indemnify and hold harmless the Indemnitee against and, if requested by the Indemnitee, shall reimburse the Indemnitee for, or advance to the Indemnitee, within 60 days of such request, all Expenses incurred by the Indemnitee in cooperating with the person or persons making such Standard of Conduct Determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Making the Standard of Conduct Determination</u>. The Company shall use its reasonable best efforts to cause any Standard of Conduct Determination required under <u>Section 9(b)</u> above to be made as promptly as practicable. If the person or persons designated to make the Standard of Conduct Determination under <u>Section 9(b)</u> shall not have made a determination within 30 days after the later of (i) receipt by the Company of a written request from the Indemnitee for indemnification pursuant to <u>Section 8</u> hereof (the date of such receipt being the "**Notification Date**"), and (ii) the selection of an Independent Counsel, if such determination is to be made by Independent Counsel, then the Indemnitee shall be deemed to have satisfied the applicable standard of conduct; *provided*, that such 30-day period may be extended for a reasonable time, not to exceed an additional 30 days, if the person or persons making such determination in good faith requires such additional time to obtain or evaluate information relating thereto. Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement of the Indemnitee to indemnification under this Agreement shall be required to be made prior to the final disposition of any Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Payment of Indemnification</u>. If, in regard to any Losses:

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| | |
|:---|:---|
| (i) | the Indemnitee shall be entitled to indemnification pursuant to <u>Section 9(a)</u> above; |
| (ii) | no Standard Conduct Determination is legally required as a condition to indemnification of the Indemnitee hereunder; or |
| (iii) | the Indemnitee has been determined or deemed pursuant to <u>Section 9(b)</u> or <u>Section 9(c)</u> above to have satisfied the Standard of Conduct Determination, |
| then the Company shall pay to the Indemnitee, within five days after the later of (A) the Notification Date, or (B) the earliest date on which the applicable criterion specified in clause (i), (ii) or (iii) is satisfied, an amount equal to such Losses. | then the Company shall pay to the Indemnitee, within five days after the later of (A) the Notification Date, or (B) the earliest date on which the applicable criterion specified in clause (i), (ii) or (iii) is satisfied, an amount equal to such Losses. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Selection of Independent Counsel for Standard of Conduct Determination</u>. If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to <u>Section 9(b)(i)</u> above, the Independent Counsel shall be selected by the Board, and the Company shall give written notice to the Indemnitee advising him or her of the identity of the Independent Counsel so selected. If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to <u>Section 9(b)(ii)</u>, the Independent Counsel shall be selected by the Indemnitee, and the Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either case, the Indemnitee or the Company, as applicable, may, within five days after receiving written notice of selection from the other, deliver to the other a written objection to such selection; *provided*, *however*, that such objection may be asserted only on the ground that the Independent Counsel so selected does not satisfy the criteria set forth in the definition of "Independent Counsel", and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person or firm selected shall act as Independent Counsel. If such written objection is properly and timely made and substantiated, (i) the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit; and (ii) the non-objecting party may, at its option, select an alternative Independent Counsel and give written notice to the other party advising such other party of the identity of the alternative Independent Counsel so selected, in which case the provisions of the two immediately preceding sentences, the introductory clause of this sentence and numbered clause (i) of this sentence shall apply to such subsequent selection and notice. If applicable, the provisions of clause (ii) of the immediately preceding sentence shall apply to successive alternative selections. If no Independent Counsel that is permitted under the foregoing provisions of this <u>Section 9(e)</u> to make the Standard of Conduct Determination shall have been selected within 20 days after the Company gives its initial notice pursuant to the first sentence of this <u>Section 9(e)</u>, or the Indemnitee gives its initial notice pursuant to the second sentence of this <u>Section 9(e)</u>, as the case may be, either the Company or the Indemnitee may petition any court of competent jurisdiction in the State of Nevada ("**Nevada Court**") to resolve any objection which shall have been made by the Company or the Indemnitee to the other's selection of Independent Counsel and/or to appoint as Independent Counsel a person to be selected by the Court or such other person as the Court shall designate, and the person or firm with respect to whom all objections are so resolved or the person or firm so appointed will act as Independent Counsel. In all events, the Company shall pay all the reasonable fees and expenses of the Independent Counsel incurred in connection with the Independent Counsel's determination pursuant to <u>Section 9(b)</u> above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Presumptions and Defenses</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>The Indemnitee's Entitlement to Indemnification</u>. In making any Standard of Conduct Determination, the person or persons making such determination shall presume that the Indemnitee has satisfied the applicable standard of conduct and is entitled to indemnification, and the Company shall have the burden of proof to overcome that presumption and establish that the Indemnitee is not so entitled. Any Standard of Conduct Determination that is adverse to the Indemnitee may be challenged by the Indemnitee in the Nevada Court. No determination by the Company (including by its directors or any Independent Counsel) that the Indemnitee has not satisfied any applicable standard of conduct may be used as a defense to any legal proceedings brought by the Indemnitee to secure indemnification or reimbursement or advance payment of Expenses by the Company hereunder or create a presumption that the Indemnitee has not met any applicable standard of conduct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Reliance as a Safe Harbor</u>. For purposes of this Agreement, and without creating any presumption as to a lack of good faith if the following circumstances do not exist, the Indemnitee shall be deemed to have acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company if the Indemnitee's actions or omissions to act are taken in good faith reliance upon the records of the Company, including its financial statements, or upon information, opinions, reports or statements furnished to the Indemnitee by the officers or employees of the Company or any of its subsidiaries in the course of their duties, or by committees of the Board or by any other Person (including legal counsel, accountants and financial advisors) as to matters the Indemnitee reasonably believes are within such other Person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Company. In addition, the knowledge and/or actions, or failures to act, of any director, officer, employee, or agent of the Company shall not be imputed to the Indemnitee for purposes of determining the right to indemnity hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>No Other Presumptions</u>. For purposes of this Agreement, the termination of any Claim by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere or its equivalent, will not create a presumption that the Indemnitee did not meet any applicable standard of conduct or have any particular belief, or that indemnification hereunder is otherwise not permitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) <u>Defense to Indemnification and Burden of Proof</u>. It shall be a defense to any action brought by the Indemnitee against the Company to enforce this Agreement (other than an action brought to enforce a claim for Losses incurred in defending against a Claim related to an Indemnifiable Event in advance of its final disposition) that it is not permissible under applicable law for the Company to indemnify the Indemnitee for the amount claimed. In connection with any such action or any related Standard of Conduct Determination, the burden of proving such a defense or that the Indemnitee did not satisfy the applicable standard of conduct shall be on the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>Resolution of Claims</u>. The Company acknowledges that a settlement or other disposition short of final judgment may be successful on the merits or otherwise for purposes of <u>Section 9(a)(i)</u> above if it permits a party to avoid expense, delay, distraction, disruption, and uncertainty. In the event that any Claim relating to an Indemnifiable Event to which the Indemnitee is a party is resolved in any manner other than by adverse judgment against the Indemnitee (including, without limitation, settlement of such action, claim or proceeding without payment of money or other consideration) it shall be presumed that the Indemnitee has been successful on the merits or otherwise for purposes of <u>Section 9(a)(i)</u>. The Company shall have the burden of proof to overcome this presumption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>Exclusions from Indemnification</u>. Notwithstanding anything in this Agreement to the contrary, the Company shall not be obligated to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) indemnify or advance funds to the Indemnitee for Expenses or Losses with respect to proceedings initiated by the Indemnitee, including any proceedings against the Company or its directors, officers, employees, or other indemnitees and not by way of defense, except:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) proceedings referenced in <u>Section 5</u> hereof (unless a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) where the Company has joined or the Board has consented to the initiation of such proceedings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) indemnify the Indemnitee if a final decision by a court of competent jurisdiction determines that such indemnification is prohibited by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) indemnify the Indemnitee for the disgorgement of profits arising from the purchase or sale by the Indemnitee of securities of the Company in violation of Section 16(b) of the Exchange Act, or any similar successor statute.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) indemnify or advance funds to the Indemnitee for the Indemnitee's reimbursement to the Company of any bonus or other incentive-based or equity-based compensation previously received by the Indemnitee or payment of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements under Section 304 of the Sarbanes-Oxley Act of 2002 (the "**Sarbanes-Oxley Act**") in connection with an accounting restatement of the Company or the payment to the Company of profits arising from the purchase or sale by the Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>Settlement of Claims</u>. The Company shall not be liable to the Indemnitee under this Agreement for any amounts paid in settlement of any threatened or pending Claim related to an Indemnifiable Event effected without the Company's prior written consent, which shall not be unreasonably withheld; *provided*, *however*, that if a Change in Control has occurred, the Company shall be liable for indemnification of the Indemnitee for amounts paid in settlement if an Independent Counsel has approved the settlement. The Company shall not settle any Claim related to an Indemnifiable Event in any manner that would impose any Losses on the Indemnitee without the Indemnitee's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Duration</u>. All agreements and obligations of the Company contained herein shall continue during the period that the Indemnitee is a director and/or officer of the Company (or is serving at the request of the Company as a director, officer, employee, member, trustee or agent of another Enterprise) and shall continue thereafter (i) so long as the Indemnitee may be subject to any possible Claim relating to an Indemnifiable Event (including any rights of appeal thereto), and (ii) throughout the pendency of any proceeding (including any rights of appeal thereto) commenced by the Indemnitee to enforce or interpret his or her rights under this Agreement, even if, in either case, he or she may have ceased to serve in such capacity at the time of any such Claim or proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>Non-Exclusivity</u>. The rights of the Indemnitee hereunder will be in addition to any other rights the Indemnitee may have under the Constituent Documents, applicable law, any other contract or otherwise (collectively, "**Other Indemnity Provisions**"); *provided*, *however*, that (a) to the extent that the Indemnitee otherwise would have any greater right to indemnification under any Other Indemnity Provision, the Indemnitee will be deemed to have such greater right hereunder, and (b) to the extent that any change is made to any Other Indemnity Provision which permits any greater right to indemnification than that provided under this Agreement as of the date hereof, the Indemnitee will be deemed to have such greater right hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Liability Insurance</u>. For the duration of the Indemnitee's service as a director and/or officer of the Company, and thereafter for so long as the Indemnitee shall be subject to any pending Claim relating to an Indemnifiable Event, the Company shall use commercially reasonable efforts (taking into account the scope and amount of coverage available relative to the cost thereof) to continue to maintain in effect policies of directors' and officers' liability insurance providing coverage that is at least substantially comparable in scope and amount to that provided by the Company's current policies of directors' and officers' liability insurance. In all policies of directors' and officers' liability insurance maintained by the Company, the Indemnitee shall be named as an insured in such a manner as to provide the Indemnitee the same rights and benefits as are provided to the most favorably insured of the Company's directors, if the Indemnitee is a director, or of the Company's officers, if the Indemnitee is an officer (and not a director) by such policy. Upon request, the Company will provide to the Indemnitee copies of all directors' and officers' liability insurance applications, binders, policies, declarations, endorsements, and other related materials.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. <u>No Duplication of Payments</u>. The Company shall not be liable under this Agreement to make any payment to the Indemnitee in respect of any Losses to the extent the Indemnitee has otherwise received payment under any insurance policy, the Constituent Documents, Other Indemnity Provisions or otherwise of the amounts otherwise indemnifiable by the Company hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. <u>Subrogation</u>. In the event of payment to the Indemnitee under this Agreement, the Company shall be subrogated to the extent of such payment to all the rights of recovery of the Indemnitee. The Indemnitee shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. <u>Amendments</u>. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall operate as a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. <u>Binding Effect</u>. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), assigns, spouses, heirs and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part of the business and/or assets of the Company, by written agreement in form and substances satisfactory to the Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. <u>Severability</u>. The provisions of this Agreement shall be severable if any of the provisions hereof (including any portion thereof) are held by a court of competent jurisdiction to be invalid, illegal, void or otherwise unenforceable, and the remaining provisions shall fully remain enforceable permitted by law. Upon such determination that any term or other provision is invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. <u>Notices</u>. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, against receipt, or mailed, by postage prepaid, certified or registered mail:

---

| | |
|:---|:---|
| (a) | if to the Indemnitee, to the address set forth on the signature page hereto. |
| (b) | if to the Company, to: |
|  | BioKey (Cayman), Inc.<br>44370 Old Warm Springs Blvd., Fremont, CA 94538<br> Attention: T.S. Jiang |

---

Notice of change of address shall be effective only when given in accordance with this <u>Section 20</u>. All notices complying with this Section shall be deemed to have been received on the date of hand delivery or on the third business day after mailing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. <u>Governing Law and Forum</u>. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada applicable to contracts made and to be performed in such state without giving effect to its principles of conflicts of laws. The Company and the Indemnitee hereby irrevocably and unconditionally: (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Nevada Court and not in any other state or federal court in the United States, (b) consent to submit to the exclusive jurisdiction of the Nevada Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (c) appoint, to the extent such party is not otherwise subject to service of process in the State of Nevada, a nationally recognized agent for service of process in the State of Nevada as its agent for acceptance of legal process in connection with any such action or proceeding against such party with the same legal force and validity as if served upon such party personally within the State of Nevada, and (d) waive, and agree not to plead or make, any claim that the Nevada Court lacks venue or that any such action or proceeding brought in the Nevada Court has been brought in an improper or inconvenient forum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. <u>Headings</u>. The headings of the sections and paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction or interpretation thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23. <u>Counterparts</u>. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original, but all of which together shall constitute one and the same Agreement.

[*Signature page follows*]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

---

| |
|:---|
| BioKey (Cayman), Inc. |
| By: |
| Name: |
| Title |
| INDEMNITEE |
| Name: |
| Address: |

---

## Exhibit 10.5

**Exhibit 10.5**

**BIOKEY (CAYMAN), INC.**

**2026 EQUITY INCENTIVE PLAN**

**BIOKEY (CAYMAN), INC.**

**2026 EQUITY INCENTIVE PLAN**

 ****

---

| | |
|:---|:---|
| **1. *Purpose*** | **1** |
| **2. *Definitions*** | **1** |
| **3. *Administration*.** | **6** |
| **4. *Shares Subject to Plan*.** | **7** |
| **5. *Eligibility*** | **8** |
| **6. *Specific Terms of Awards*.** | **8** |
| **7. *Certain Provisions Applicable to Awards*.** | **13** |
| **8. *Change in Control*.** | **15** |
| **9. *General Provisions*.** | **17** |

---

i

**BIOKEY (CAYMAN), INC.**

**2026 EQUITY INCENTIVE PLAN**

1**. *Purpose.*** The purpose of this **BioKey (Cayman), Inc.** 2026 Equity Incentive Plan (including any sub-plans as applicable), as may be amended from time to time (the "***Plan***") is to assist BioKey (Cayman), Inc., a Cayman Islands exempted company with limited liability (the "***Company***"), and its Related Entities (as hereinafter defined) in attracting, motivating, retaining and rewarding high-quality executives and other employees, officers, directors, consultants and other persons who provide services to the Company or its Related Entities by enabling such persons to acquire or increase a proprietary interest in the Company in order to strengthen the mutuality of interests between such persons and the Company's shareholders, and providing such persons with performance incentives to expend their maximum efforts in the creation of shareholder value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. ***Definitions.*** For purposes of the Plan, the following terms shall be defined as set forth below, in addition to such terms defined in Section 1 hereof and elsewhere herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "***Affiliate***" shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act and any successor to such Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "***Award***" shall mean any Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Share granted as a bonus or in lieu of another Award, Dividend Equivalent, Other Stock-Based Award or Performance Award, together with any other right or interest relating to Shares or other property (including cash), granted to a Participant under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "***Award Agreement***" shall mean any written or electronic agreement, contract or other instrument or document evidencing any Award granted under this Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) "***Agreement***" shall mean that certain Separation and Distribution Agreement, dated as of [●], 2026, by and between ABVC BioPharma, Inc., a Nevada corporation ("ABVC"), and the Company, as may be amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) "***Beneficiary***" shall mean the person, persons, trust or trusts that have been designated by a Participant in his or her most recent written beneficiary designation filed with the Committee to receive the benefits specified under the Plan upon such Participant's death or to which Awards or other rights are transferred if and to the extent permitted under Section 9(b) hereof. If, upon a Participant's death, there is no designated Beneficiary or surviving designated Beneficiary, then the term Beneficiary means the Participant's estate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) "***Beneficial Owner***" ***and "Beneficial Ownership"*** shall have the meaning ascribed to such term in Rule 13d-3 under the Exchange Act and any successor to such Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) "***Board***" shall mean the Board of Directors of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) "***Cause***" shall have the equivalent meaning or the same meaning as "cause" or "for cause" as set forth in any employment, consulting, or other agreement for the performance of services between the Participant and the Company or a Related Entity or, in the absence of any such agreement or any such definition in such agreement, such term shall mean (i) the failure by the Participant to perform, in a reasonable manner, his or her duties as assigned by the Company or a Related Entity, (ii) any violation or breach by the Participant of his or her employment, consulting or other similar agreement with the Company or a Related Entity, if any, or any violation or breach of any material written policy or rule of the Company or a Related Entity as may be in effect from time to time, including any of such policy or rule regarding sexual harassment or work-place discrimination, (iii) any violation or breach by the Participant of any non-competition, non-solicitation, non-disclosure, confidentiality and/or other similar agreement with the Company or a Related Entity, (iv) any act by the Participant of dishonesty or bad faith with respect to the Company or a Related Entity, including the Participant's commission of or participation in an act of fraud, embezzlement, misappropriation, breach of fiduciary duty against the Company or a Related Entity, (v) the Participant's unlawful use (including being under the influence) or possession of illegal drugs on the premises of the Company or a Related Entity or while performing Participant's duties and responsibilities for the Company or a Related Entity, or the use of alcohol, drugs or other similar substances in a manner that adversely affects the Participant's work performance, or (vi) the Participant's conviction of, or plea of guilty or nolo contendere to, any felony or crime involving moral turpitude. The good faith determination by the Committee of whether the Participant's Continuous Service was terminated by the Company for "Cause" shall be final and binding for all purposes hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) "***Change in Control***" shall mean a Change in Control as defined in Section 8(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) "***Code***" shall mean the United States Internal Revenue Code of 1986, as amended from time to time, including regulations thereunder and successor provisions and regulations thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) "***Committee***" shall mean a committee designated by the Board to administer the Plan; provided, however, that if the Board fails to designate a committee or if there are no longer any members on the committee so designated by the Board, or for any other reason determined by the Board, then the Board shall serve as the Committee. While it is intended that the Committee shall consist of at least two directors, each of whom shall be (i) a "non-employee director" within the meaning of Rule 16b-3 (or any successor rule) under the Exchange Act, unless administration of the Plan by "non-employee directors" is not then required in order for exemptions under Rule 16b-3 to apply to transactions under the Plan and (ii) "Independent", the failure of the Committee to be so comprised shall not invalidate any Award that otherwise satisfies the terms of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) "***Consultant***" shall mean any consultant or advisor who provides services to the Company or any Related Entity, so long as (i) such person renders bona fide services that are not in connection with the offer and sale of the Company's securities in a capital-raising transaction, (ii) such person does not directly or indirectly promote or maintain a market for the Company's securities, and (iii) the identity of such person would not preclude the Company from offering or selling securities to such person pursuant to the Plan in reliance on either the exemption from registration provided by Rule 701 under the United States Securities Act of 1933, as amended or, if the Company is required to file reports pursuant to Section 13 or 15(d) of the Exchange Act, registration on a Form S-8 Registration Statement under the United States Securities Act of 1933, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) "***Continuous Service***" shall mean the uninterrupted provision of services to the Company or any Related Entity in any capacity of Employee, Director, Consultant or other service provider. Continuous Service shall not be considered to be interrupted in the case of (i) any approved leave of absence (including, without limitation, sick leave, military leave, or any other authorized personal leave), (ii) transfers among the Company, any Related Entities, or any successor entities, in any capacity of Employee, Director, Consultant or other service provider, or (iii) any change in status as long as the individual remains in uninterrupted service of the Company or a Related Entity in any capacity of Employee, Director, Consultant or other service provider (except as otherwise provided in the Award Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) "***Director***" shall mean a member of the Board or the board of directors of any Related Entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) "***Disability***" shall mean, unless otherwise defined in an Award Agreement, for purposes of the exercise of an Incentive Stock Option, a permanent and total disability, within the meaning of Section 22(e)(3) of the Code, and for all other purposes, the Participant's inability to perform the duties of his or her position with the Company or any Related Entity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) "***Dividend Equivalent***" shall mean a right, granted to a Participant under Section 6(g) hereof, to receive cash, Shares, other Awards or other property equal in value to dividends paid with respect to a specified number of Shares, or other periodic payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) "***Effective Date***" shall mean the Distribution Date (as defined in the Agreement), which shall be [●], 2026.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) "***Eligible Person***" shall mean each Director, Employee, Consultant and other persons who provides services to the Company or any Related Entity. The foregoing notwithstanding, only Employees of the Company, or any parent corporation or subsidiary corporation of the Company (as those terms are defined in Sections 424(e) and (f) of the Code, respectively), shall be Eligible Persons for purposes of receiving any Incentive Stock Options. An Employee on leave of absence may, in the discretion of the Committee, be considered as still in the employ of the Company or a Related Entity for purposes of eligibility for participation in the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) "***Employee***" shall mean any person, including an officer or Director, who is an employee of the Company or any Related Entity, or is a prospective employee of the Company or any Related Entity (conditioned upon and effective not earlier than, such person becoming an employee of the Company or any Related Entity). The payment of a Director's fee by the Company or a Related Entity shall not be sufficient to constitute "employment" by the Company or Related Entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) "***Exchange Act***" shall mean the United States Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) "***Fair Market Value***" shall mean the fair market value of Shares, Awards or other property on the date as of which the value is being determined, as determined by the Committee, or under procedures established by the Committee, in a manner intended to satisfy the principles of Section 409A of the Code or Section 422 of the Code, to the extent applicable, subject to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If, on such date, the Shares are listed on an international, national or regional securities exchange or market system, the Fair Market Value of a Share shall be the closing price of a Share (or the mean of the closing bid and asked prices of a Share if the Share is so quoted instead) as quoted on the applicable exchange or system, as reported in The Wall Street Journal or such other source as the Committee deems reliable. If the relevant date does not fall on a day on which the Shares have traded on such exchange or system, the date on which the Fair Market Value shall be established shall be the last day on which the Shares were so traded prior to the relevant date, or such other appropriate day as shall be determined by the Committee, in its discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If, on such date, the Shares are not listed on an international, national or regional securities exchange or market system but is traded on an over-the-counter market, the Fair Market Value of a Share shall be the average of the closing bid and asked prices for Shares or, if no closing bid and asked prices, the last closing price, in such over-the-counter market for the last preceding date on which there was a sale of such Shares in such market.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If, on such date, the Shares are not listed on an international, national or regional securities exchange or market system and are not traded on an over-the-counter market, the Fair Market Value of a Share shall be as determined by the Committee in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) "***Incentive Stock Option***" shall mean any Option intended to be designated as an incentive stock option within the meaning of Section 422 of the Code or any successor provision thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) "***Independent***", when referring to either the Board or members of the Committee, shall have the same meaning as used in the rules of the Listing Market.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) "***Incumbent Board***" shall mean the Incumbent Board as defined in Section 8(b)(ii) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) ***"Listing Market"*** shall mean the international, national or regional securities exchange or over-the-counter market on which any securities of the Company are listed or quoted for trading, including the OTC Bulletin Board and/or the OTC Markets Group, Inc., and if not listed or quoted for trading, by the rules of the OTC Markets Group, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) "***Option***" shall mean a right granted to a Participant under Section 6(b) hereof, to purchase Shares at a specified price during specified time periods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) "***Optionee***" shall mean a person to whom an Option is granted under this Plan or any person who succeeds to the rights of such person under this Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb) "***Other Stock-Based Awards***" shall mean Awards granted to a Participant under Section 6(i) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc) "***Parent***" shall mean any corporation (other than the Company), whether now or hereafter existing, in an unbroken chain of corporations ending with the Company, if each of the corporations in the chain (other than the Company) owns stock possessing 50% or more of the combined voting power of all classes of stock in one of the other corporations in the chain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd) "***Participant***" shall mean a person who has been granted an Award under the Plan which remains outstanding, including a person who is no longer an Eligible Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee) "***Performance Award***" shall mean any Award granted pursuant to Section 6(h) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff) "***Performance Period***" shall mean that period established by the Committee at the time any Performance Award is granted or at any time thereafter during which any performance goals specified by the Committee with respect to such Award are to be measured.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg) "***Person***" shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof and shall include a "group" as defined in Section 13(d) thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(hh) "***Related Entity***" shall mean any Parent or Subsidiary, and any business, corporation, partnership, limited liability company or other entity designated by the Committee in which the Company, a Parent or a Subsidiary holds a substantial ownership interest, directly or indirectly and with respect to which the Company may offer or sell securities pursuant to the Plan in reliance upon either Rule 701 under the Securities Act of 1933, as amended or, if the Company is required to file reports pursuant to Section 13 or 15(d) of the Exchange Act, registration on a Form S-8 Registration Statement under the Securities Act of 1933, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) "***Restricted Stock***" shall mean any Share issued with such risks of forfeiture and other restrictions as the Committee, in its sole discretion, may impose (including any restriction on the right to vote such Share and the right to receive any dividends), which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(jj) "***Restricted Stock Award***" shall mean an Award granted to a Participant under Section 6(d) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(kk) "***Restricted Stock Unit***" shall mean a right to receive Shares, including Restricted Stock, cash measured based upon the value of Shares, or a combination thereof, at the end of a specified deferral period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ll) "***Restricted Stock Unit Award***" shall mean an Award of Restricted Stock Units granted to a Participant under Section 6(e) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(mm) ***"Restriction Period"*** shall mean the period of time specified by the Committee that Restricted Stock Awards shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(nn) "***Rule 16b-3***" shall mean Rule 16b-3, as from time to time in effect and applicable to the Plan and Participants, promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(oo) ***"Shares***" shall mean the ordinary shares of the Company, and such other securities as may be substituted (or resubstituted) for Shares pursuant to Section 9(c) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(pp) "***Stock Appreciation Right***" shall mean a right granted to a Participant under Section 6(c) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(qq) "***Subsidiary***" shall mean any corporation or other entity in which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities or interests of such corporation or other entity entitled to vote generally in the election of directors or in which the Company has the right to receive 50% or more of the distribution of profits or 50% or more of the assets on liquidation or dissolution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(rr) "***Substitute Awards***" shall mean Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, Awards previously granted, or the right or obligation to make future Awards, by a company (i) acquired by the Company or any Related Entity, (ii) which becomes a Related Entity after the date hereof, or (iii) with which the Company or any Related Entity combines.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. ***Administration*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***Authority of the Committee.*** The Plan shall be administered by the Committee except to the extent (and subject to the limitations imposed by Section 3(b) hereof) the Board elects to administer the Plan, in which case the Plan shall be administered by only those members of the Board who are Independent, in which case references herein to the "Committee" shall be deemed to include references to the Independent members of the Board. The Committee shall have full and final authority, subject to and consistent with the provisions of the Plan, to select Eligible Persons to become Participants, grant Awards, determine the type, number and other terms and conditions of, and all other matters relating to, Awards, prescribe Award Agreements (which need not be identical for each Participant) and rules and regulations for the administration of the Plan, construe and interpret the Plan and Award Agreements and correct defects, supply omissions or reconcile inconsistencies therein, and to make all other decisions and determinations as the Committee may deem necessary or advisable for the administration of the Plan. In exercising any discretion granted to the Committee under the Plan or pursuant to any Award, the Committee shall not be required to follow past practices, act in a manner consistent with past practices, or treat any Eligible Person or Participant in a manner consistent with the treatment of any other Eligible Persons or Participants. Decisions of the Committee shall be final, conclusive and binding on all persons or entities, including the Company, any Related Entity or any Participant or Beneficiary, or any transferee under Section 9(b) hereof or any other person claiming rights from or through any of the foregoing persons or entities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Manner of Exercise of Committee Authority.*** The Committee, and not the Board, shall exercise sole and exclusive discretion (i) on any matter relating to a Participant then subject to Section 16 of the Exchange Act with respect to the Company to the extent necessary in order that transactions by such Participant shall be exempt under Rule 16b-3 under the Exchange Act, and (ii) with respect to any Award to an Independent Director. The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of the Committee. The Committee may delegate to members of the Board, or officers or managers of the Company or any Related Entity, or committees thereof, the authority, subject to such terms and limitations as the Committee shall determine, to perform such functions, including administrative functions as the Committee may determine to the extent that such delegation will not result in the loss of an exemption under Rule 16b-3(d)(1) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company. The Committee may appoint agents to assist it in administering the Plan, including, without limitation, appointing one or more members of the Company's management, with the power or authority otherwise granted to the Committee under this Plan with respect to a number of Shares reserved and available for delivery under the Plan, subject to the terms and limitations of such power or authority as determined by the Committee in its sole and absolute discretion. In no event, however, may an agent appointed by the Committee to assist it in administering the Plan be permitted to grant Awards to, or exercise any discretion with respect to any and all other matters relating to Awards previously granted to, such agent appointed by the Committee to assist it in administering the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ***Limitation of Liability.*** The Committee and the Board, and each member thereof, shall be entitled to, in good faith, rely or act upon any report or other information furnished to him or her by any officer or Employee, the Company's independent auditors, Consultants or any other agents assisting in the administration of the Plan. Members of the Committee and the Board, and any officer or Employee acting at the direction or on behalf of the Committee or the Board, shall not be personally liable for any action or determination taken or made in good faith with respect to the Plan, and shall, to the extent permitted by law, be fully indemnified and protected by the Company with respect to any such action or determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. ***Shares Subject to Plan*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***Limitation on Overall Number of Shares Available for Delivery Under Plan.*** Subject to adjustment as provided in Section 9(c) hereof, the aggregate number of Shares that may be issued under all Awards under the Plan shall be equal to [●] (the "***Share Pool***"). In addition, the Share Pool will automatically increase on January 1, 2028 (the "***Refresh Date***") and on each second anniversary of such Refresh Date during the term of the Plan, in an amount equal to the lesser of (i) five percent (5%) of the total number of Shares outstanding as of the December 31 immediately prior to such January 1 and (ii) such smaller number of Shares as is determined by the Board. Any Shares delivered under the Plan may consist, in whole or in part, of authorized and unissued shares or treasury shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Application of Limitation to Grants of Awards.*** No Award may be granted if the number of Shares to be delivered in connection with such an Award exceeds the number of Shares remaining available for delivery under the Plan, minus the number of Shares that would be counted against the limit upon settlement of then outstanding Awards. The Committee may adopt reasonable counting procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or Substitute Awards) and make adjustments if the number of Shares actually delivered differs from the number of Shares previously counted in connection with an Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ***Availability of Shares Not Delivered under Awards and Adjustments to Limits.***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If any Shares subject to an Award are forfeited, expire or otherwise terminate without issuance of such Shares, or any Award is settled for cash or otherwise does not result in the issuance of all or a portion of the Shares subject to such Award, the Shares to which those Awards were subject, shall, to the extent of such forfeiture, expiration, termination, non-issuance or cash settlement, be added back to the Share Pool and again be available for delivery with respect to Awards under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Shares withheld from an Award to satisfy either (i) the exercise price or purchase price of such Award, or (ii) any tax withholding requirements shall not count against the maximum number of Shares remaining available for issuance pursuant to Awards granted under the Plan and, for the avoidance of doubt, shall be added back to the Share Pool.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Substitute Awards shall not reduce the Shares authorized for delivery under the Plan or authorized for delivery to a Participant in any period; provided, that Substitute Awards issued in connection with the assumption of, or in substitution for, outstanding Incentive Stock Options shall be counted against the aggregate number of Shares available for Awards of Incentive Stock Options under the Plan pursuant to Section 4(c)(v) herein. Additionally, in the event that an entity acquired by the Company or any Related Entity or with which the Company or any Related Entity combines has shares available under a pre-existing plan approved by its shareholders and not adopted in contemplation of such acquisition or combination, the shares available for delivery pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares authorized for delivery under the Plan if and to the extent that the use of such Shares would not require approval of the Company's shareholders under the rules of the Listing Market. Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees, Directors, Consultants or other service providers prior to such acquisition or combination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any Share that again becomes available for delivery pursuant to this Section 4(c) shall be added back as one (1) Share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Notwithstanding anything in this Section 4(c) to the contrary but subject to adjustment as provided in Section 9(c) hereof, the maximum aggregate number of Shares that may be delivered under the Plan as a result of the exercise of the Incentive Stock Options shall be [●] Shares. In no event shall any Incentive Stock Options be granted under the Plan after the tenth anniversary of the date on which the Board adopts the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Notwithstanding anything in this Section 4 to the contrary, in any fiscal year of the Company during any part of which the Plan is in effect, the aggregate value of all compensation payable to a Participant who is a Director but is not also an Employee or Consultant, including cash fees and any Awards granted under this Plan (valued based on the "fair value" as of the date of grant as determined in accordance with FASB ASC Topic 718 (or any other applicable accounting guidance)), shall not exceed $**[●]**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. ***Eligibility***. Awards may be granted under the Plan only to Eligible Persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. ***Specific Terms of Awards*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***General.*** Awards may be granted on the terms and conditions set forth in this Section 6. In addition, the Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter (subject to Section 9(e) hereof), such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including terms requiring forfeiture of Awards in the event of termination of the Participant's Continuous Service and terms permitting a Participant to make elections relating to his or her Award. Except as otherwise expressly provided herein, the Committee shall retain full power and discretion to accelerate, waive or modify, at any time, any term or condition of an Award that is not mandatory under the Plan. Except in cases in which the Committee is authorized to require other forms of consideration under the Plan, or to the extent other forms of consideration must be paid to satisfy the requirements of applicable laws, no consideration other than services may be required for the grant (as opposed to the exercise) of any Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Options.*** The Committee is authorized to grant Options to any Eligible Person on the following terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Exercise Price***. Other than in connection with Substitute Awards, the exercise price per Share purchasable under an Option shall be determined by the Committee, provided that such exercise price shall not be less than 100% of the Fair Market Value of a Share on the date of grant of the Option with respect to any Participants who are United States taxpayers and shall not, in any event, be less than the par value of a Share on the date of grant of the Option. If an Employee owns or is deemed to own (by reason of the attribution rules applicable under Section 424(d) of the Code) more than 10% of the combined voting power of all classes of stock of the Company (or any parent corporation or subsidiary corporation of the Company, as those terms are defined in Sections 424(e) and (f) of the Code, respectively) and an Incentive Stock Option is granted to such Employee, the exercise price of such Incentive Stock Option (to the extent required by the Code at the time of grant) shall be no less than 110% of the Fair Market Value of a Share on the date such Incentive Stock Option is granted. Other than pursuant to Section 9(c)(i) and (ii) of this Plan, the Committee shall not be permitted to (A) lower the exercise price per Share of an Option after it is granted, (B) cancel an Option when the exercise price per Share exceeds the Fair Market Value of the underlying Shares in exchange for cash or another Award (other than in connection with Substitute Awards), (C) cancel an outstanding Option in exchange for an Option with an exercise price that is less than the exercise price of the original Options or (D) take any other action with respect to an Option that may be treated as a repricing pursuant to the applicable rules of the Listing Market, without approval of the Company's shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Time and Method of Exercise***. The Committee shall determine the time or times at which or the circumstances under which an Option may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the method by which notice of exercise is to be given and the form of exercise notice to be used, the time or times at which Options shall cease to be or become exercisable following termination of Continuous Service or upon other conditions, the methods by which the exercise price may be paid or deemed to be paid (including in the discretion of the Committee a cashless exercise procedure), the form of such payment, including, without limitation, cash, Shares (including without limitation the withholding of Shares otherwise deliverable pursuant to the Award), other Awards or awards granted under other plans of the Company or a Related Entity, or other property (including notes or other contractual obligations of Participants to make payment on a deferred basis provided that such deferred payments are not in violation of Section 13(k) of the Exchange Act, or any rule or regulation adopted thereunder or any other applicable law), and the methods by or forms in which Shares will be delivered or deemed to be delivered to Participants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ***Form of Settlement.*** The Committee may, in its sole discretion, provide that the Shares to be issued upon exercise of an Option shall be in the form of Restricted Stock or other similar securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) ***Incentive Stock Options***. The Committee shall only grant Incentive Stock Options if (y) with respect to the initial Share Pool set forth in Section 4(a) and 4(c)(vi), within 12 months of the Effective Date, and/or (z) with respect to any increase in the Share pools set forth in Sections 4(a) and 4(c)(v) by an amendment to this Plan, within 12 months of the effective date of any such amendment the Plan or amendment, whichever applicable, is approved by shareholders of the Company eligible to vote in the election of directors, by a vote sufficient to meet the requirements of Code Section 422, applicable requirements under the rules of any stock exchange or automated quotation system on which the Shares may be listed or quoted, and other laws, regulations, and obligations of the Company applicable to the Plan. Incentive Stock Options may be granted subject to shareholder approval but may not be exercised or otherwise settled in the event the shareholder approval is not obtained. The terms of any Incentive Stock Option granted under the Plan shall comply in all respects with the provisions of Section 422 of the Code. Anything in the Plan to the contrary notwithstanding, no term of the Plan relating to Incentive Stock Options (including any Stock Appreciation Right issued in tandem therewith) shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be exercised, so as to disqualify either the Plan or any Incentive Stock Option under Section 422 of the Code, unless the Participant has first requested, or consents to, the change that will result in such disqualification. Thus, if and to the extent required to comply with Section 422 of the Code, Options granted as Incentive Stock Options shall be subject to the following special terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) the Option shall not be exercisable for more than ten years after the date such Incentive Stock Option is granted; provided, however, that if a Participant owns or is deemed to own (by reason of the attribution rules of Section 424(d) of the Code) more than 10% of the combined voting power of all classes of stock of the Company (or any parent corporation or subsidiary corporation of the Company, as those terms are defined in Sections 424(e) and (f) of the Code, respectively) and the Incentive Stock Option is granted to such Participant, the term of the Incentive Stock Option shall be (to the extent required by the Code at the time of the grant) for no more than five years from the date of grant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) the aggregate Fair Market Value (determined as of the date the Incentive Stock Option is granted) of the Shares with respect to which Incentive Stock Options granted under the Plan and all other option plans of the Company (and any parent corporation or subsidiary corporation of the Company, as those terms are defined in Sections 424(e) and (f) of the Code, respectively) that become exercisable for the first time by the Participant during any calendar year shall not (to the extent required by the Code at the time of the grant) exceed $100,000 (or such other limit as required by the Code); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) if Shares acquired by exercise of an Incentive Stock Option are disposed of within two years following the date the Incentive Stock Option is granted or one year following the transfer of such Shares to the Participant upon exercise, the Participant shall, promptly following such disposition, notify the Company in writing of the date and terms of such disposition and provide such other information regarding the disposition as the Committee may reasonably require.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ***Stock Appreciation Rights.*** The Committee may grant Stock Appreciation Rights to any Eligible Person in conjunction with all or part of any Option granted under the Plan or at any subsequent time during the term of such Option (a "***Tandem Stock Appreciation Right***"), or without regard to any Option (a "***Freestanding Stock Appreciation Right***"), in each case upon such terms and conditions as the Committee may establish in its sole discretion, not inconsistent with the provisions of the Plan, including the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Right to Payment***. A Stock Appreciation Right shall confer on the Participant to whom it is granted a right to receive, upon exercise thereof, the excess of (A) the Fair Market Value of one Share on the date of exercise over (B) the grant price of the Stock Appreciation Right as determined by the Committee. The grant price of a Stock Appreciation Right shall not be less than 100% of the Fair Market Value of a Share on the date of grant with respect to any Participants who are United States taxpayers, in the case of a Freestanding Stock Appreciation Right, or less than the associated Option exercise price, in the case of a Tandem Stock Appreciation Right. Other than pursuant to Section 9(c)(i) and (ii) of the Plan, the Committee shall not be permitted to (A) lower the grant price per Share of a Stock Appreciation Right after it is granted, (B) cancel a Stock Appreciation Right when the grant price per Share exceeds the Fair Market Value of the underlying Shares in exchange for another Award (other than in connection with Substitute Awards), (C) cancel an outstanding Stock Appreciation Right in exchange for a Stock Appreciation Right with a grant price that is less than the grant price of the original Stock Appreciation Right, or (D) take any other action with respect to a Stock Appreciation Right that may be treated as a repricing pursuant to the applicable rules of the Listing Market, without shareholder approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Other Terms***. The Committee shall determine at the date of grant or thereafter, the time or times at which and the circumstances under which a Stock Appreciation Right may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the time or times at which Stock Appreciation Rights shall cease to be or become exercisable following termination of Continuous Service or upon other conditions, the method of exercise, method of settlement, form of consideration payable in settlement, method by or forms in which Shares will be delivered or deemed to be delivered to Participants, whether or not a Stock Appreciation Right shall be in tandem or in combination with any other Award, and any other terms and conditions of any Stock Appreciation Right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ***Tandem Stock Appreciation Rights***. Any Tandem Stock Appreciation Right may be granted at the same time as the related Option is granted or, for Options that are not Incentive Stock Options, at any time thereafter before exercise or expiration of such Option. Any Tandem Stock Appreciation Right related to an Option may be exercised only when the related Option would be exercisable and the Fair Market Value of the Shares subject to the related Option exceeds the exercise price at which Shares can be acquired pursuant to the Option. In addition, if a Tandem Stock Appreciation Right exists with respect to less than the full number of Shares covered by a related Option, then an exercise or termination of such Option shall not reduce the number of Shares to which the Tandem Stock Appreciation Right applies until the number of Shares then exercisable under such Option equals the number of Shares to which the Tandem Stock Appreciation Right applies. Any Option related to a Tandem Stock Appreciation Right shall no longer be exercisable to the extent the Tandem Stock Appreciation Right has been exercised, and any Tandem Stock Appreciation Right shall no longer be exercisable to the extent the related Option has been exercised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) ***Restricted Stock Awards.*** The Committee is authorized to grant Restricted Stock Awards to any Eligible Person on the following terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Grant and Restrictions***. Restricted Stock Awards shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose, or as otherwise provided in this Plan during the Restriction Period. The terms of any Restricted Stock Award granted under the Plan shall be set forth in a written Award Agreement which shall contain provisions determined by the Committee and not inconsistent with the Plan. The restrictions may lapse separately or in combination at such times, under such circumstances (including based on achievement of performance goals and/or future service requirements), in such installments or otherwise, as the Committee may determine at the date of grant or thereafter. Except to the extent restricted under the terms of the Plan and any Award Agreement relating to a Restricted Stock Award, a Participant granted Restricted Stock shall have all of the rights of a shareholder, including the right to vote the Restricted Stock and the right to receive dividends thereon (subject to any mandatory reinvestment or other requirement imposed by the Committee). During the period that the Restricted Stock Award is subject to a risk of forfeiture, subject to Section 9(b) below and except as otherwise provided in the Award Agreement, the Restricted Stock may not be sold, transferred, pledged, hypothecated, margined or otherwise encumbered by the Participant or Beneficiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Forfeiture***. Except as otherwise determined by the Committee, upon termination of a Participant's Continuous Service during the applicable Restriction Period, the Participant's Restricted Stock that is at that time subject to a risk of forfeiture that has not lapsed or otherwise been satisfied shall be forfeited and reacquired by the Company; provided that the Committee may provide, by resolution or other action or in any Award Agreement, or may determine in any individual case, that forfeiture conditions relating to Restricted Stock Awards shall be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of Restricted Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ***Certificates for Stock***. Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing Restricted Stock are registered in the name of the Participant, the Committee may require that such certificates bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock, that the Company retain physical possession of the certificates, and that the Participant deliver a stock power to the Company, endorsed in blank, relating to the Restricted Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) ***Dividends and Splits***. As a condition to the grant of a Restricted Stock Award, the Committee shall either (A) require that any cash dividends paid on a Share of Restricted Stock be automatically reinvested in additional Shares of Restricted Stock, or (B) require that payment be delayed (with or without interest at such rate, if any, as the Committee shall determine) and remain subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such cash dividend is payable, in each case in a manner that does not violate the requirements of Section 409A of the Code. Unless otherwise determined by the Committee, Shares distributed in connection with a stock split or stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such Shares or other property have been distributed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) ***Restricted Stock Unit Award.*** The Committee is authorized to grant Restricted Stock Unit Awards to any Eligible Person on the following terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Award and Restrictions***. Satisfaction of a Restricted Stock Unit Award shall occur upon expiration of the deferral period specified for such Restricted Stock Unit Award by the Committee (or, if permitted by the Committee, as elected by the Participant in a manner that does not violate the requirements of Section 409A of the Code). In addition, a Restricted Stock Unit Award shall be subject to such restrictions (which may include a risk of forfeiture) as the Committee may impose, if any, which restrictions may lapse at the expiration of the deferral period or at earlier specified times (including based on achievement of performance goals and/or future service requirements), separately or in combination, in installments or otherwise, as the Committee may determine. A Restricted Stock Unit Award may be satisfied by delivery of Shares, cash equal to the Fair Market Value of the specified number of Shares covered by the Restricted Stock Units, or a combination thereof, as determined by the Committee at the date of grant or thereafter. Prior to satisfaction of a Restricted Stock Unit Award, a Restricted Stock Unit Award carries no voting or dividend or other rights associated with Share ownership. Prior to satisfaction of a Restricted Stock Unit Award, except as otherwise provided in an Award Agreement and as permitted under Section 409A of the Code, a Restricted Stock Unit Award may not be sold, transferred, pledged, hypothecated, margined or otherwise encumbered by the Participant or any Beneficiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Forfeiture***. Except as otherwise determined by the Committee, upon termination of a Participant's Continuous Service during the applicable deferral period or portion thereof to which forfeiture conditions apply (as provided in the Award Agreement evidencing the Restricted Stock Unit Award), the Participant's Restricted Stock Unit Award that is at that time subject to a risk of forfeiture that has not lapsed or otherwise been satisfied shall be forfeited; provided that the Committee may provide, by resolution or other action or in any Award Agreement, or may determine in any individual case, that forfeiture conditions relating to a Restricted Stock Unit Award shall be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of any Restricted Stock Unit Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ***Dividend Equivalents***. As a condition to the grant of a Restricted Stock Unit and if the Award Agreement provides for Dividend Equivalents with respect to the underlying Restricted Stock Units, the Committee shall require that any cash dividends paid on a Share attributable to such Restricted Stock Unit be delayed (with or without interest at such rate, if any, as the Committee shall determine) and remain subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock Unit with respect to which such cash dividend is payable, in a manner that does not violate the requirements of Section 409A of the Code. Unless otherwise determined by the Committee, Shares distributed in connection with a stock split or stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock Unit with respect to which such Shares or other property have been distributed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) ***Bonus Stock and Awards in Lieu of Obligations***. The Committee is authorized to grant Shares to any Eligible Persons as a bonus, or to grant Shares or other Awards in lieu of obligations to pay cash or deliver other property under the Plan or under other plans or compensatory arrangements, provided that, in the case of Eligible Persons subject to Section 16 of the Exchange Act, the amount of such grants remains within the discretion of the Committee to the extent necessary to ensure that acquisitions of Shares or other Awards are exempt from liability under Section 16(b) of the Exchange Act. Shares or Awards granted hereunder shall be subject to such other terms as shall be determined by the Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) ***Dividend Equivalents***. The Committee is authorized to grant Dividend Equivalents to any Eligible Person entitling the Eligible Person to receive cash, Shares, other Awards, or other property equal in value to the dividends paid with respect to a specified number of Shares, or other periodic payments. Dividend Equivalents may be awarded on a free-standing basis or in connection with another Award. The Committee may provide that Dividend Equivalents shall be paid or distributed when accrued, or whether such Dividend Equivalents shall be deemed to have been reinvested in additional Shares, Awards, or other investment vehicles, and subject to such restrictions on transferability and risks of forfeiture, as the Committee may specify; provided, that in no event shall such Dividend Equivalents be paid out to Participants prior to vesting of the corresponding Shares underlying the Award. Any such determination by the Committee shall be made at the grant date of the applicable Award. Notwithstanding the foregoing, Dividend Equivalents credited in connection with an Award that vests based on the achievement of performance goals shall be subject to restrictions and risk of forfeiture to the same extent as the Award with respect to which such Dividend Equivalents have been credited.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) ***Performance Awards.*** The Committee is authorized to grant Performance Awards to any Eligible Person payable in cash, Shares, or other Awards, on terms and conditions established by the Committee. The performance criteria to be achieved during any Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award. The performance criteria may consist of the following (determined for the Company, on a consolidated basis, and/or for Related Entities, or for business or geographical units of the Company and/or a Related Entity), without limitation: (1) earnings per share; (2) revenues or margins; (3) cash flow (including operating cash flow, free cash flow, discounted return on investment, and cash flow in excess of cost of capital); (4) operating margin; (5) return on net assets, investment, capital, or equity; (6) economic value added; (7) direct contribution; (8) net income; pretax earnings; earnings before all or some of the following items: interest, taxes, depreciation, amortization, stock-based compensation, ASC 718 expense, or any extraordinary or special items; earnings after interest expense and before extraordinary or special items; operating income or income from operations; income before interest income or expense, unusual items and income taxes, local, state or federal and excluding budgeted and actual bonuses which might be paid under any ongoing bonus plans of the Company; (9) working capital; (10) management of fixed costs or variable costs; (11) identification or consummation of investment opportunities or completion of specified projects in accordance with corporate business plans, including strategic mergers, acquisitions or divestitures; (12) total stockholder return; (13) debt reduction; (14) market share; (15) entry into new markets, either geographically or by business unit; (16) customer retention and satisfaction; (17) strategic plan development and implementation, including turnaround plans; and/or (18) the Fair Market Value of a Share. Any of the foregoing criteria may be determined on an absolute or relative basis or as compared to the performance of a published or special index deemed applicable by the Committee including, but not limited to, the Standard & Poor's 500 Stock Index, the Nasdaq Composite Index, the Russell 2000 Index, or another group of companies that are deemed comparable to the Company. In determining the achievement of the performance goals, unless otherwise specified by the Committee at the time the performance goals are set, the Committee shall exclude the impact of (i) restructurings, discontinued operations, and extraordinary items (as defined pursuant to generally accepted accounting principles), and other unusual or non-recurring charges, (ii) change in accounting standards required by generally accepted accounting principles; or (iii) such other exclusions or adjustments as the Committee specifies at the time the Award is granted. Except as may be provided in Section 8 or an Award Agreement, Performance Awards will be distributed only after the end of the relevant Performance Period. The performance goals to be achieved for each Performance Period, the duration of the Performance Period and the amount of the Award to be distributed, in each case, shall be conclusively determined by the Committee. Performance Awards may be paid in a lump sum or in installments following the close of the Performance Period or, in accordance with procedures established by the Committee, on a deferred basis in a manner that does not violate the requirements of Section 409A of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Other Stock-Based Awards.*** The Committee is authorized, subject to limitations under applicable law, to grant to any Eligible Person such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares, as deemed by the Committee to be consistent with the purposes of the Plan. Other Stock-Based Awards may be granted to Participants either alone or in addition to other Awards granted under the Plan, and such Other Stock-Based Awards shall also be available as a form of payment in the settlement of other Awards granted under the Plan. The Committee shall determine the terms and conditions of such Awards. Shares delivered pursuant to an Award in the nature of a purchase right granted under this Section 6(i) shall be purchased for such consideration, (including without limitation loans from the Company or a Related Entity provided that such loans are not in violation of Section 13(k) of the Exchange Act or any rule or regulation adopted thereunder or any other applicable law) paid for at such times, by such methods, and in such forms, including, without limitation, cash, Shares, other Awards or other property, as the Committee shall determine.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. ***Certain Provisions Applicable to Awards*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***Stand-Alone, Additional, Tandem, and Substitute Awards.*** Awards granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution or exchange for, any other Award or any award granted under another plan of the Company, any Related Entity, or any business entity to be acquired by the Company or a Related Entity, or any other right of a Participant to receive payment from the Company or any Related Entity. Such additional, tandem, and substitute or exchange Awards may be granted at any time. If an Award is granted in substitution or exchange for another Award or award, the Committee shall require the surrender of such other Award or award in consideration for the grant of the new Award. In addition, Awards may be granted in lieu of cash compensation, including in lieu of cash amounts payable under other plans of the Company or any Related Entity, in which the value of Shares subject to the Award is equivalent in value to the cash compensation (for example, Restricted Stock or Restricted Stock Units), or in which the exercise price, grant price or purchase price of the Award in the nature of a right that may be exercised is equal to the Fair Market Value of the underlying Shares minus the value of the cash compensation surrendered, provided that any such determination to grant an Award in lieu of cash compensation must be made in a manner intended to be exempt from or comply with Section 409A of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Term of Awards.*** The term of each Award shall be for such period as may be determined by the Committee; provided that in no event shall the term of any Option or Stock Appreciation Right exceed a period of ten years (or in the case of an Incentive Stock Option such shorter term as may be required under Section 422 of the Code); provided, however, that in the event that on the last day of the term of an Option or a Stock Appreciation Right, other than an Incentive Stock Option, (i) the exercise of the Option or Stock Appreciation Right is prohibited by applicable law, or (ii) Shares may not be purchased, or sold by certain employees or directors of the Company due to the "black-out period" of a Company policy or a "lock-up" agreement undertaken in connection with an issuance of securities by the Company, the term of the Option or Stock Appreciation Right may be extended by the Committee for a period of up to thirty (30) days following the end of the legal prohibition, black-out period or lock-up agreement, provided that such extension of the term of the Option or Stock Appreciation Right would not cause the Option or Stock Appreciation Right to violate the requirements of Section 409A of the Code .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ***Form and Timing of Payment Under Awards; Deferrals.*** Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by the Company or a Related Entity upon the exercise of an Option or other Award or settlement of an Award may be made in such forms as the Committee shall determine, including, without limitation, cash, Shares, other Awards or other property, and may be made in a single payment or transfer, in installments, or on a deferred basis, provided that any determination to pay in installments or on a deferred basis shall be made by the Committee at the date of grant. Any installment or deferral provided for in the preceding sentence shall, however, subject to the terms of the Plan, be subject to the Company's compliance with the provisions of the Sarbanes-Oxley Act of 2002, as amended, the rules and regulations adopted by the Securities and Exchange Commission thereunder, all applicable rules of the Listing Market and any other applicable law, and in a manner intended to be exempt from or otherwise satisfy the requirements of Section 409A of the Code. Subject to Section 7(e) of this Plan, the settlement of any Award may be accelerated, and cash paid in lieu of Shares in connection with such settlement, in the sole discretion of the Committee or upon occurrence of one or more specified events (in addition to a Change in Control). Any such settlement shall be at a value determined by the Committee in its sole discretion, which, without limitation, may in the case of an Option or Stock Appreciation Right be limited to the amount if any by which the Fair Market Value of a Share on the settlement date exceeds the exercise or grant price. Installment or deferred payments may be required by the Committee (subject to Section 7(e) of this Plan, including the consent provisions thereof in the case of any deferral of an outstanding Award not provided for in the original Award Agreement) or permitted at the election of the Participant on terms and conditions established by the Committee. The acceleration of the settlement of any Award, and the payment of any Award in installments or on an deferred basis, all shall be done in a manner that is intended to be exempt from or otherwise satisfy the requirements of Section 409A of the Code. The Committee may, without limitation, make provision for the payment or crediting of a reasonable interest rate on installment or deferred payments or the grant or crediting of Dividend Equivalents or other amounts in respect of installment or deferred payments denominated in Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) ***Exemptions from Section 16(b) Liability.*** It is the intent of the Company that the grant of any Awards to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt from Section 16 pursuant to an applicable exemption (except for transactions acknowledged in writing to be non-exempt by such Participant). Accordingly, if any provision of this Plan or any Award Agreement does not comply with the requirements of Rule 16b-3 then applicable to any such transaction, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Participant shall avoid liability under Section 16(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) ***Code Section 409A.*** (i) The Award Agreement for any Award that the Committee reasonably determines to constitute a "nonqualified deferred compensation plan" under Section 409A of the Code (a "***Section 409A Plan***"), and the provisions of the Section 409A Plan applicable to that Award, shall be construed in a manner consistent with the applicable requirements of Section 409A of the Code, and the Committee, in its sole discretion and without the consent of any Participant, may amend any Award Agreement (and the provisions of the Plan applicable thereto) if and to the extent that the Committee determines that such amendment is necessary or appropriate to comply with the requirements of Section 409A of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If any Award constitutes a Section 409A Plan, then the Award shall be subject to the following additional requirements, if and to the extent required to comply with Section 409A of the Code:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Payments under the Section 409A Plan may be made only upon (u) the Participant's "separation from service", (v) the date the Participant becomes "disabled", (w) the Participant's death, (x) a "specified time (or pursuant to a fixed schedule)" specified in the Award Agreement at the date of the deferral of such compensation, (y) a "change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets" of the Company, or (z) the occurrence of an "unforeseeable emergency";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) The time or schedule for any payment of the deferred compensation may not be accelerated, except to the extent provided in applicable Treasury Regulations or other applicable guidance issued by the Internal Revenue Service;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Any elections with respect to the deferral of such compensation or the time and form of distribution of such deferred compensation shall comply with the requirements of Section 409A(a)(4) of the Code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) In the case of any Participant who is "specified employee", a distribution on account of a "separation from service" may not be made before the date which is six months after the date of the Participant's "separation from service" (or, if earlier, the date of the Participant's death); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) Each separately identified amount to which a Participant is entitled under a Section 409A Plan shall be treated as a separate payment. In addition, to the extent permissible under Section 409A, any series of installment payments under a Section 409A Plan shall be treated as a right to a series of separate payments.

For purposes of the foregoing, the terms in quotations shall have the same meanings as those terms have for purposes of Section 409A of the Code, and the limitations set forth herein shall be applied in such manner (and only to the extent) as shall be necessary to comply with any requirements of Section 409A of the Code that are applicable to the Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Notwithstanding the foregoing, or any provision of this Plan or any Award Agreement, the Company does not make any representation to any Participant or Beneficiary that any Awards made pursuant to this Plan are exempt from, or satisfy, the requirements of, Section 409A of the Code, and the Company shall have no liability or other obligation to indemnify or hold harmless the Participant or any Beneficiary for any tax, additional tax, interest or penalties that the Participant or any Beneficiary may incur in the event that any provision of this Plan, or any Award Agreement, or any amendment or modification thereof, or any other action taken with respect thereto, is deemed to violate any of the requirements of Section 409A of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. ***Change in Control*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***Effect of "Change in Control."*** Subject to any limitations or reductions as may be necessary to comply with Section 409A of the Code, an Award may be subject to acceleration of vesting and exercisability if and only to the extent expressly provided for in any employment or other agreement between the Participant and the Company or any Related Entity, or in any Award Agreement entered into prior to the occurrence of a Change in Control (as defined below), or to the extent otherwise determined by the Committee in its sole discretion and without any requirement that each Participant be treated consistently. Except as otherwise provided in Section 8(a)(iv) hereof, such Awards shall be treated as follows upon the occurrence of a "Change in Control," as defined in Section 8(b):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any Option or Stock Appreciation Right that was not previously vested and exercisable as of the time of the Change in Control, shall become immediately vested and exercisable, subject to applicable restrictions set forth in Section 9(a) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any restrictions, deferral of settlement, and forfeiture conditions applicable to a Restricted Stock Award, Restricted Stock Unit Award or an Other Stock-Based Award subject only to future service requirements granted under the Plan shall lapse and such Awards shall be deemed fully vested as of the time of the Change in Control, except to the extent of any waiver by the Participant and subject to applicable restrictions set forth in Section 9(a) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) With respect to any outstanding Award subject to achievement of performance goals and conditions under the Plan, the Committee may, in its discretion, consider such Awards to have been earned and payable based on actual achievement of performance goals as measured immediately prior to the consummation of the Change in Control or based upon target performance (either in full or pro-rata based on the portion of the Performance Period completed as of the Change in Control), except to the extent of any waiver by the Participant and subject to applicable restrictions set forth in Section 9(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Except as otherwise provided in any employment or other agreement for services between the Participant and the Company or any Related Entity, and unless the Committee otherwise determines in a specific instance, each outstanding Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Stock-Based Award shall not be accelerated as described in Sections 8(a)(i), (ii) and (iii), if either (A) the Company is the surviving entity in the Change in Control and the Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Stock-Based Award continues to be outstanding after the Change in Control on substantially the same terms and conditions as were applicable immediately prior to the Change in Control or (B) the successor company or its parent company assumes or substitutes for the applicable Award, as determined in accordance with Section 9(c)(ii) of this Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Definition of "Change in Control".*** Unless otherwise specified in any employment or other agreement for services between the Participant and the Company or any Related Entity, or in an Award Agreement, a "***Change in Control***" shall mean the occurrence of any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The acquisition (whether by purchase, merger, consolidation, combination, or other similar transaction) by any Person of Beneficial Ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than fifty percent (50%) of (A) the then-outstanding shares of Common Stock or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "***Outstanding Company Voting Securities***") (the foregoing Beneficial Ownership hereinafter being referred to as a "***Controlling Interest***"); provided, however, that for purposes of this Plan, the following acquisitions shall not constitute or result in a Change in Control: (w) any acquisition by the Company or any Related Entity; (x) any acquisition by any Person that as of the Effective Date owns Beneficial Ownership of a Controlling Interest; (y) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Related Entity; or (z) any acquisition by any entity pursuant to a transaction which complies with the following (1) all or substantially all of the individuals and entities who were the Beneficial Owners, respectively, of the Outstanding Company Voting Securities immediately prior to such transaction beneficially own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of members of the board of directors (or comparable governing body of an entity that does not have such a board), as the case may be, of the entity resulting from such transaction (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) (the "***Continuing Entity***") immediately prior to such transaction, of the Outstanding Company Voting Securities, (excluding any outstanding voting securities of the Continuing Entity that such Beneficial Owners hold immediately following the consummation of the transaction as a result of their ownership, prior to such consummation, of voting securities of any company or other entity involved in or forming part of such transaction other than the Company), and (2) no Person (excluding any employee benefit plan (or related trust) of the Company or any Continuing Entity or any entity controlled by the Continuing Entity or any Person that as of the Effective Date owns Beneficial Ownership of a Controlling Interest) beneficially owns, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the Continuing Entity except to the extent that such ownership existed prior to the transaction; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) During any period of twelve (12) consecutive months (not including any period prior to the Effective Date) individuals who constitute the Board on the Effective Date (the "***Incumbent Board***") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Consummation of a sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries (taken as a whole) to any Person who is not an Affiliate.

Notwithstanding anything to the contrary herein, the term "Change in Control" shall <u>not</u> include any sale of assets, a merger or other transaction effected exclusively for the purpose of changing the domicile of the Company. If required for compliance with Section 409A of the Code, in no event will a Change in Control be deemed to have occurred if such transaction is not also a "change in the ownership or effective control of" the Company or "a change in the ownership of a substantial portion of the assets of" the Company as determined under Treasury Regulation Section 1.409A-3(i)(5) (without regard to any alternative definition thereunder).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. ***General Provisions*.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ***Compliance With Legal and Other Requirements***. The Company may, to the extent deemed necessary or advisable by the Committee, postpone the issuance or delivery of Shares or payment of other benefits under any Award until completion of such registration or qualification of such Shares or other required action under any federal or state law, rule or regulation, listing or other required action with respect to the Listing Market, or compliance with any other obligation of the Company, as the Committee, may consider appropriate, and may require any Participant to make such representations, furnish such information and comply with or be subject to such other conditions as it may consider appropriate in connection with the issuance or delivery of Shares or payment of other benefits in compliance with applicable laws, rules, and regulations, listing requirements, or other obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ***Limits on Transferability; Beneficiaries***. No Award or other right or interest granted under the Plan shall be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of such Participant to any party, or assigned or transferred by such Participant otherwise than by will or the laws of descent and distribution or to a Beneficiary upon the death of a Participant, and such Awards or rights that may be exercisable shall be exercised during the lifetime of the Participant only by the Participant or his or her guardian or legal representative, except that Awards and other rights (other than Incentive Stock Options and Stock Appreciation Rights in tandem therewith) may be transferred to one or more Beneficiaries or other transferees during the lifetime of the Participant, and may be exercised by such transferees in accordance with the terms of such Award, but only if and to the extent such transfers are permitted by the Committee pursuant to the express terms of an Award Agreement (subject to any terms and conditions which the Committee may impose thereon), are by gift or pursuant to a domestic relations order, and are to a "Permitted Assignee" that is a permissible transferee under the applicable rules of the Securities and Exchange Commission for registration of securities on a Form S-8 registration statement. For this purpose, a ***Permitted Assignee*** shall mean (i) the Participant's spouse, children or grandchildren (including any adopted and step children or grandchildren), parents, grandparents or siblings, (ii) a trust for the benefit of one or more of the Participant or the persons referred to in clause (i), (iii) a partnership, limited liability company or corporation in which the Participant or the persons referred to in clauses (i) and (ii) are the only partners, members or shareholders, or (iv) a foundation in which any person or entity designated in clauses (i), (ii) or (iii) above control the management of assets. A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Award Agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) ***Adjustments.***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Adjustments to Awards***. In the event that any extraordinary dividend or other distribution (whether in the form of cash, Shares, or other property), recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange, liquidation, dissolution or other similar corporate transaction or event affects the Shares and/or such other securities of the Company or any other issuer, then the Committee shall, in such manner as it may deem appropriate and equitable, substitute, exchange or adjust any or all of (A) the number and kind of Shares which may be delivered in connection with Awards granted thereafter, (B) the number and kind of Shares subject to or deliverable in respect of outstanding Awards, (C) the exercise price, grant price or purchase price relating to any Award and/or make provision for payment of cash or other property in respect of any outstanding Award, and (D) any other aspect of any Award that the Committee determines to be appropriate in order to prevent the reduction or enlargement of benefits under any Award; provided, that in the case of any "equity restructuring" (within the meaning of the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor pronouncement thereto)), the Committee shall make an equitable or proportionate adjustment to outstanding Awards to reflect such equity restructuring. Any adjustment under this Section 9(c) shall be conclusive and binding for all purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Adjustments in Case of Certain Transactions***. In the event of any merger, consolidation or other reorganization in which the Company does not survive, or in the event of any Change in Control (and subject to the provisions of Section 8 of this Plan relating to the vesting of Awards in the event of any Change in Control and subject to any limitations or reductions as may be necessary to comply with Section 409A of the Code), any outstanding Awards may be dealt with in accordance with any of the following approaches, without the requirement of obtaining any consent or agreement of a Participant as such, as determined by the agreement effectuating the transaction or, if and to the extent not so determined, as determined by the Committee: (A) the continuation of the outstanding Awards by the Company, if the Company is a surviving entity, (B) the assumption or substitution for, as those terms are defined below, the outstanding Awards by the surviving entity or its parent or subsidiary, (C) full exercisability or vesting and accelerated expiration of the outstanding Awards, or (D) settlement of the value of the outstanding Awards in cash or cash equivalents or other property followed by cancellation of such Awards, which value, in the case of Options or Stock Appreciation Rights, shall be measured by the amount, if any, by which the Fair Market Value of a Share exceeds the exercise or grant price of the Option or Stock Appreciation Right as of the effective date of the transaction, (it being understood that, in such event, any Option or Stock Appreciation Right having a per Share exercise or grant price equal to, or in excess of, the Fair Market Value of a Share subject thereto may be canceled and terminated without any payment or consideration therefor). For the purposes of this Plan, an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Performance Award or Other Stock-Based Award shall be considered assumed or substituted for if following the applicable transaction the Award confers the right to purchase or receive, for each Share subject to the Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Performance Award or Other Stock-Based Award immediately prior to the applicable transaction, on substantially the same vesting and other terms and conditions as were applicable to the Award immediately prior to the applicable transaction, the consideration (whether stock, cash or other securities or property) received in the applicable transaction by holders of Shares for each Share held on the effective date of such transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the applicable transaction is not solely common stock of the successor company or its parent or subsidiary, the Committee may, with the consent of the successor company or its parent or subsidiary, provide that the consideration to be received upon the exercise or vesting of an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Performance Award or Other Stock-Based Award, for each Share subject thereto, will be solely common stock of the successor company or its parent or subsidiary substantially equal in fair market value to the per share consideration received by holders of Shares in the applicable transaction. The determination of such substantial equality of value of consideration shall be made by the Committee in its sole discretion and its determination shall be conclusive and binding. The Committee shall give written notice of any proposed transaction referred to in this Section 9(c)(ii) a reasonable period of time prior to the closing date for such transaction (which notice may be given either before or after the approval of such transaction), in order that Participants may have a reasonable period of time prior to the closing date of such transaction within which to exercise any Awards that are then exercisable (including any Awards that may become exercisable upon the closing date of such transaction). A Participant may condition his or her exercise of any Awards upon the consummation of the transaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) ***Other Adjustments***. The Committee or the Board is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards (including Awards subject to satisfaction of performance goals, or performance goals and conditions relating thereto) in recognition of unusual or nonrecurring events (including, without limitation, acquisitions and dispositions of businesses and assets) affecting the Company, any Related Entity or any business unit, or the financial statements of the Company or any Related Entity, or in response to changes in applicable laws, regulations, accounting principles, tax rates and regulations or business conditions or in view of the Committee's assessment of the business strategy of the Company, any Related Entity or business unit thereof, performance of comparable organizations, economic and business conditions, personal performance of a Participant, and any other circumstances deemed relevant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) ***Award Agreements.*** Each Award Agreement shall either be (a) in writing in a form approved by the Committee and executed by the Company by an officer duly authorized to act on its behalf, or (b) an electronic notice in a form approved by the Committee and recorded by the Company (or its designee) in an electronic recordkeeping system used for the purpose of tracking one or more types of Awards as the Committee may provide; in each case and if required by the Committee, the Award Agreement shall be executed or otherwise electronically accepted by the recipient of the Award in such form and manner as the Committee may require. The Committee may authorize any officer of the Company to execute any or all Award Agreements on behalf of the Company. The Award Agreement shall set forth the material terms and conditions of the Award as established by the Committee consistent with the provisions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) ***Taxes.*** The Company and any Related Entity are authorized to withhold from any Award granted, any payment relating to an Award under the Plan, including from a distribution of Shares, or any payroll or other payment to a Participant, amounts of withholding and other taxes due or potentially payable in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Company or any Related Entity and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award. This authority shall include authority to withhold or receive Shares or other property and to make cash payments in respect thereof in satisfaction of a Participant's tax obligations, either on a mandatory or elective basis in the discretion of the Committee. The amount of withholding tax paid with respect to an Award by the withholding of Shares otherwise deliverable pursuant to the Award or by delivering Shares already owned shall not exceed the maximum statutory withholding required with respect to that Award (or such other limit as the Committee shall impose, including without limitation, any limit imposed to avoid or limit any financial accounting expense relating to the Award).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) ***Changes to the Plan and Awards.*** The Board may amend, alter, suspend, discontinue or terminate the Plan, or the Committee's authority to grant Awards under the Plan, without the consent of shareholders or Participants, except that any amendment or alteration to the Plan shall be subject to the approval of the Company's shareholders not later than the annual meeting next following such Board action if such shareholder approval is required by any federal or state law or regulation (including, without limitation, Rule 16b-3) or the rules of the Listing Market, and the Board may otherwise, in its discretion, determine to submit other such changes to the Plan to shareholders for approval; provided that, except as otherwise permitted by the Plan or Award Agreement, without the consent of an affected Participant, no such Board action may materially and adversely affect the rights of such Participant under the terms of any previously granted and outstanding Award. The Committee may waive any conditions or rights under, or amend, alter, suspend, discontinue or terminate any Award theretofore granted and any Award Agreement relating thereto, except as otherwise provided in the Plan; provided that, except as otherwise permitted by the Plan or Award Agreement, without the consent of an affected Participant, no such Committee or the Board action may materially and adversely affect the rights of such Participant under terms of such Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Clawback of Benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Company may (A) cause the cancellation of any Award, (B) require reimbursement of any Award by a Participant or Beneficiary, and (C) effect any other right of recoupment of equity or other compensation provided under this Plan or otherwise in accordance with any Company policies that currently exist or that may from time to time be adopted or modified in the future by the Company and/or applicable law (each, a "***Clawback Policy***"). In addition, a Participant may be required to repay to the Company certain previously paid compensation, whether provided under this Plan or an Award Agreement or otherwise, in accordance with any Clawback Policy. By accepting an Award, a Participant is also agreeing to be bound by any existing or future Clawback Policy adopted by the Company, or any amendments that may from time to time be made to the Clawback Policy in the future by the Company in its discretion (including without limitation any Clawback Policy adopted or amended to comply with applicable laws or stock exchange requirements) and is further agreeing that all of the Participant's Award Agreements may be unilaterally amended by the Company, without the Participant's consent, to the extent that the Company in its discretion determines to be necessary or appropriate to comply with any Clawback Policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If the Participant, without the consent of the Company, while employed by or providing services to the Company or any Related Entity or after termination of such employment or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement or otherwise engages in activity that is in conflict with or adverse to the interest of the Company or any Related Entity, as determined by the Committee in its sole discretion, then (i) any outstanding, vested or unvested, earned or unearned portion of the Award may, at the Committee's discretion, be canceled and (ii) the Committee, in its discretion, may require the Participant or other person to whom any payment has been made or Shares or other property have been transferred in connection with the Award to forfeit and pay over to the Company, on demand, all or any portion of the gain (whether or not taxable) realized upon the exercise of any Option or Stock Appreciation Right and the value realized (whether or not taxable) on the vesting or payment of any other Award during the time period specified in the Award Agreement or otherwise specified by the Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) ***Limitation on Rights Conferred Under Plan.*** Neither the Plan nor any action taken hereunder or under any Award shall be construed as (i) giving any Eligible Person or Participant the right to continue as an Eligible Person or Participant or in the employ or service of the Company or a Related Entity; (ii) interfering in any way with the right of the Company or a Related Entity to terminate any Eligible Person's or Participant's Continuous Service at any time, (iii) giving an Eligible Person or Participant any claim to be granted any Award under the Plan or to be treated uniformly with other Participants and Employees, or (iv) conferring on a Participant any of the rights of a shareholder of the Company or any Related Entity including, without limitation, any right to receive dividends or distributions, any right to vote or act by written consent, any right to attend meetings of shareholders or any right to receive any information concerning the Company's or any Related Entity's business, financial condition, results of operation or prospects, unless and until such time as the Participant is duly issued Shares on the stock books of the Company or any Related Entity in accordance with the terms of an Award. None of the Company, its officers or its directors shall have any fiduciary obligation to the Participant with respect to any Awards unless and until the Participant is duly issued Shares pursuant to the Award on the stock books of the Company in accordance with the terms of an Award. Neither the Company, nor any Related Entity, nor any of their respective officers, directors, representatives or agents is granting any rights under the Plan to the Participant whatsoever, oral or written, express or implied, other than those rights expressly set forth in this Plan or the Award Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Unfunded Status of Awards; Creation of Trusts.*** The Plan is intended to constitute an "unfunded" plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant or obligation to deliver Shares pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give any such Participant any rights that are greater than those of a general creditor of the Company or Related Entity that issues the Award; provided that the Committee may authorize the creation of trusts and deposit therein cash, Shares, other Awards or other property, or make other arrangements to meet the obligations of the Company or Related Entity under the Plan. Such trusts or other arrangements shall be consistent with the "unfunded" status of the Plan unless the Committee otherwise determines with the consent of each affected Participant. The trustee of such trusts may be authorized to dispose of trust assets and reinvest the proceeds in alternative investments, subject to such terms and conditions as the Committee may specify and in accordance with applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) ***Non-exclusivity of the Plan.*** Neither the adoption of the Plan by the Board nor its submission to the shareholders of the Company for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other incentive arrangements as it may deem desirable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) ***Payments in the Event of Forfeitures; Fractional Shares.*** Unless otherwise determined by the Committee, in the event of a forfeiture of an Award with respect to which a Participant paid cash or other consideration, the Participant shall be repaid the amount of such cash or other consideration. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) ***Governing Law.*** Except as otherwise provided in any Award Agreement, the validity, construction and effect of the Plan, any rules and regulations under the Plan, and any Award Agreement shall be determined in accordance with the laws of the Cayman Islands, in each case, without giving effect to principles of conflict of laws, and applicable federal law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) ***Foreign Laws***. The Committee shall have the authority to adopt such modifications, procedures, and subplans as may be necessary or desirable to comply with provisions of the laws of foreign countries in which the Company or its Related Entities may operate to assure the viability of the benefits from Awards granted to Participants performing services in such countries and to meet the objectives of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) ***Plan Effective Date; Termination of Plan.*** The Plan shall become effective on the Effective Date. The Plan shall terminate at the earliest of (i) such time as no Shares remain available for issuance under the Plan, (ii) termination of this Plan by the Board, or (iii) the tenth anniversary of the Effective Date. Awards outstanding upon expiration of the Plan shall remain in effect until they have been exercised or terminated or have expired.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) ***Construction and Interpretation.*** Whenever used herein, nouns in the singular shall include the plural, and the masculine pronoun shall include the feminine gender. Headings of Articles and Sections hereof are inserted for convenience and reference and constitute no part of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) ***Severability***. If any provision of the Plan or any Award Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction.

## Exhibit 10.6

**Exhibit 10.6**

**SHARE TRANSFER AGREEMENT**

BY AND AMONG

ABVC BioPharma, Inc.

BioKey, Inc. (Cayman)

AND

BioKey, Inc. (California)

DATED: May 10, 2025

**SHARE TRANSFER AGREEMENT**

This SHARE TRANSFER AGREEMENT (this "<u>Agreement</u>"), dated as of May 10, 2025 is entered into by and between (i) ABVC BioPharma, Inc., a Nevada corporation (the "<u>Selling Shareholder</u>") and (ii) BioKey, Inc. (Cayman), an exempted company incorporated with limited liability under the Laws of the Cayman Islands (the "<u>Purchaser</u>"). The Selling Shareholder and the Purchaser are referred to in this Agreement collectively as the "<u>Parties</u>" and individually as a "<u>Party</u>."

W I T N E S E T H:

WHEREAS, BioKey, Inc. (California) (the "<u>Company</u>") is a company incorporated in California "BIOKEY";

WHEREAS, the Selling Shareholder legally and directly owns 7,418,134 shares of common stock, 7,000,000 shares of Series A preferred stock, 1,160,000 shares of Series B preferred stock, and 13,973,097 shares of Series C preferred stock, which equates to 100% of the issued and outstanding stock of the Company, with a par value of US$0.001 per share (the "<u>Company Stock</u>") as disclosed in its SEC Filings; and

WHEREAS, the Selling Shareholder desires to sell to the Purchaser, and the Purchaser desires to purchase from the Selling Shareholder, subject to the terms and conditions set forth herein, all of the Selling Shareholder's right, title and interest in and pertaining to 100% of the Issued and Outstanding Shares (the "<u>Subject Shares</u>"), and the board of directors of the Selling Shareholder has approved the transactions contemplated herein.

NOW, THEREFORE, in consideration of the promises and the mutual covenants and agreements hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, the Parties hereby agree as follows:

**ARTICLE I**

**<u>Definitions</u>**

Section 1.1 <u>Certain Definitions</u>. For purposes of this Agreement, the following terms shall have the meanings specified in this <u>Section 1.1</u>:

"<u>Affiliate</u>" means any other Person that, directly or indirectly through one or more intermediaries, Controls, or is Controlled by, or is under common Control with, such Person, including, without limitation, with respect to any Person that is an individual, his or her immediate family shareholders.

"<u>Business Day</u>" means a day that is not a Saturday or Sunday or any other day on which banks in the United States of America, or the Cayman Islands are required or authorized to be closed.

"<u>Common Stock</u>" means Common Stock with a par value of US$0.001 per share in the share capital of the Company.

ABVC BioPharma, Inc., Share Transfer Agreement 2/18

"<u>Control</u>" of a given Person means the power or authority, whether exercised or not, to direct the business, management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, which power or authority shall conclusively be presumed to exist upon possession of beneficial ownership or power to direct the vote of more than fifty percent (50%) of the votes entitled to be cast at a meeting of the shareholders or shareholders of such Person or power to control the composition of a majority of the board of directors (or similar governing body) of such Person; the term "<u>Controlled</u>" has the meaning correlative to the foregoing.

"<u>Governmental Authority</u>" means any federal, national, supranational, state, provincial, local or other government, governmental, regulatory or administrative authority, agency or commission or any court, tribunal, or judicial or arbitral body.

"<u>knowledge of the Selling Shareholder</u>" means the actual knowledge of the Selling Shareholder after due inquiry.

"<u>knowledge of the Purchaser</u>" means the actual knowledge of the Purchaser after due inquiry.

"<u>Law</u>" means any foreign, federal, state, municipal or local law, statute, code, ordinance, rule, decree, regulation or any common law of any Government Authority or jurisdiction.

"<u>Legal Proceeding</u>" means any judicial, administrative or arbitral actions, suits, proceedings, audit, hearing, mediation or investigations (whether civil or criminal, judicial or administrative, at law or in equity, or public or private) by or before a Government Authority.

"<u>Liability</u>" means any liability, cost, expense (including reasonable attorneys' fees), debt or obligation of any kind, character or description, and whether known or unknown, accrued, absolute, determined, determinable, contingent or otherwise, and regardless of when asserted or by whom.

"<u>Lien</u>" means any claim, pledge, lien, charge, mortgage, right of first refusal or other option to purchase or otherwise acquire any interest, easement, security interest or other encumbrance or restriction on use, voting, transfer or receipt of income or exercise of any other attribute of ownership.

"<u>Merger</u>" means a business combination to be conducted pursuant to the relevant definitive agreement as may be entered into by and between the Company and Purchaser (and, as the case maybe, one or more Affiliates of the Company or Purchaser) and effected pursuant to applicable laws, as a result of which the Company (or a subsidiary of the Company) would acquire all outstanding Company Stock of BioKey and BioKey would become a wholly owned subsidiary of the Purchaser.

"<u>Order</u>" means any written order, injunction, judgment, decree, notice, ruling, writ, assessment or arbitration award of a Government Authority.

"<u>Organizational Documents</u>" means, with respect to an entity, its certificate of incorporation, articles of incorporation, by-laws, articles of association, memorandum of association, certificate of trust, trust agreement, partnership agreement, limited partnership agreement, certificate of formation, limited liability company agreement or operating agreement, as applicable.

"<u>Permit</u>" means any approval, authorization, consent, license, variance, clearance, order, exemption, permit or certificate of or issued by a Government Authority.

ABVC BioPharma, Inc., Share Transfer Agreement 3/18

"<u>Person</u>" means any individual, corporation, partnership, limited liability company, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Government Authority or other entity.

"Preferred Stock" means 7,000,000 shares of Series A preferred stock, 1,160,000 shares of Series B preferred stock, and 13,973,097, shares of Series C preferred stock with a par value of US$0.001 per share of the Company.

"<u>Share</u>" means a share in the capital of the Company.

"<u>SEC</u>" means the United States Securities and Exchange Commission.

"<u>Securities Act</u>" means the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

"<u>Subsidiary</u>" means, with respect to any given Person, any other Person that is Controlled directly or indirectly by such given Person, including, in the case of the Company, any variable interest entity Controlled by and consolidated with the Company and any Subsidiaries of such variable interest entity.

"<u>Tax</u>" or "<u>Taxes</u>" means (a) any federal, national, provincial, municipal, local or foreign and other taxes, duties, imposts, levies, or other like assessments of any kind whatsoever in the nature of a tax, in each case, imposed by any Governmental Authority, including all net income (including enterprise income tax and individual income withholding tax), turnover (including value-added tax, business tax, and consumption tax), resource (including urban and township land use tax), special purpose (including land value-added tax, urban maintenance and construction tax, and additional education fees), property (including urban real estate tax and land use fees), documentation (including stamp duty and deed tax), filing, recording, tariffs (including import duty and import value-added tax), and other taxes, (b) all interest, penalties (administrative, civil or criminal), or additional amounts imposed by any Governmental Authority in connection with any item described in clause (a) above, and (c) other form of transfer liability imposed by any Government Authority in connection with any item described in clauses (a) and (b) above.

"<u>Transfer</u>" means, (i) when used as a verb, to sell, assign, dispose of, transfer, exchange, pledge, encumber, hypothecate or otherwise transfer securities, assets or other property or any participation or interest therein, whether directly or indirectly (including pursuant to a derivative transaction, merger, recapitalization, scheme of arrangement, amalgamation or other transaction or by operation of law), or agree or commit to do any of the foregoing and (ii) when used as a noun, a direct or indirect sale, assignment, disposition, exchange, pledge, encumbrance, hypothecation, or other transfer of such securities, assets or other property or any participation or interest therein or any agreement or commitment to do any of the foregoing.

"<u>U.S.</u>" means the United States of America.

ABVC BioPharma, Inc., Share Transfer Agreement 4/18

Section 1.2 <u>Interpretation and Rules of Construction</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the provision of a **Table of Contents**, the division of this Agreement into articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized in construing or interpreting this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any reference in this Agreement to an Article, Section, Exhibit or Schedule, such reference is to an Article or Section of, or a Schedule or Exhibit to, this Agreement, unless otherwise indicated. All Exhibits and Schedules hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any reference in this Agreement to gender shall include all genders, and words imparting the singular number only shall include the plural and *vice versa*;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the word "including" or any variation thereof means (unless the context of its usage otherwise requires) "including, without limitation" and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) words such as "herein," "hereinafter," "hereof" and "hereunder" refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) when calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the term "non-assessable," when used with respect to any shares, means that no further sums are required to be paid by the holders thereof in connection with the issuance thereof; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) except as otherwise provided herein, any reference in this Agreement to $ or US$ means U.S. dollars, the lawful currency of the U.S.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event an ambiguity or question of intent or interpretation arises, no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

**ARTICLE II**

**<u>Sale and Purchase of Shares</u>**

Section 2.1 <u>Sale and Purchase of Shares</u>. Upon the terms and subject to the conditions set forth herein and at the Closing, the Selling Shareholder shall sell and transfer to the Purchaser, and the Purchaser hereby agrees to purchase from the Selling Shareholder, the Subject Shares and all of the Selling Shareholder's right, title and interest to the Subject Shares, free and clear of all Liens for an aggregate purchase price of US$100 (the "<u>Purchase Price</u>") payable by the Purchaser to the Selling Shareholder pursuant to <u>Section 2.6(a)</u>, provided that any dividend declared by the Company on any Subject Share with a record date that is on or before the date that is twelve months after the Closing Date or such other date as may be mutually agreed in writing by the Parties shall belong to the Selling Shareholder, and the Purchaser shall remit to the Selling Shareholder any such dividend on the Subject Shares as received by the Purchaser from the Company within three Business Days thereafter.

ABVC BioPharma, Inc., Share Transfer Agreement 5/18

Section 2.2 <u>Closing Date</u>. The sale and purchase of all Subject Shares as contemplated by this Agreement (the "<u>Closing</u>") shall take place remotely via exchange of documents and signature and shall occur on the 30<u><sup>th</sup></u> day after the date hereof, or an earlier day as may be mutually agreed in writing by the Parties, provided that each of the conditions set forth under <u>Section 2.3</u> and <u>Section 2.4</u> shall have been satisfied (or waived by the Party entitled to do so in accordance with the terms thereof) before or at the Closing. The date on which the Closing actually takes place is referred to in this Agreement as the "<u>Closing Date</u>".

Section 2.3 <u>Conditions Precedent for the Selling Shareholder.</u> The obligations of the Selling Shareholder to consummate the Closing under <u>Section 2.5</u> are subject to the satisfaction of the following conditions, unless waived in writing by the Selling Shareholder on or prior to the Closing Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all of the representations and warranties of the Purchaser contained in <u>Article IV</u> shall be true and correct in all material respects (other than the representations and warranties set forth in <u>Section 4.1</u> and <u>Section 4.2</u>, which shall be true and correct in all respects) on and as of the date hereof and on the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Purchaser has performed all of its obligations contained in this Agreement that are to be performed prior to the Closing in all material respects; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) no provision of any applicable treaty, law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, shall prohibit the consummation of the Closing.

Section 2.4 <u>Conditions Precedent for the Purchaser.</u> The obligations of the Purchaser to consummate the Closing under <u>Section 2.6</u> are subject to the satisfaction of the following conditions, unless waived in writing by the Purchaser on or prior to the Closing Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all of the representations and warranties of the Selling Shareholder contained in <u>Article III</u> shall be true and correct in all material respects (other than the representations and warranties set forth in <u>Section 3.1</u>, <u>Section 3.2</u> and <u>Section 3.3</u>, which shall be true and correct in all respects) on and as of the date hereof and on the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Selling Shareholder has performed all of its obligations contained in this Agreement that are to be performed prior to the Closing in all material respects; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) no provision of any applicable treaty, law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, shall prohibit the consummation of the Closing.

Section 2.5 <u>Closing Deliverables by the Selling Shareholder</u>. At the Closing, the Selling Shareholder shall deliver or cause to be delivered to the Purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a certified true copy of the updated register of shareholders of the Company, dated as of the Closing Date and duly certified by the registered office provider of the Company, evidencing the ownership by the Purchaser of the Subject Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) an irrevocable instrument of transfer in respect of the Subject Shares being sold by the Selling Shareholder to the Purchaser executed by the Selling Shareholder in the form attached as <u>Exhibit A</u> to this Agreement; and

ABVC BioPharma, Inc., Share Transfer Agreement 6/18

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a copy of the resolutions of the board of directors of the Selling Shareholder or the minutes of a duly convened board meeting of the Selling Shareholder, as the case may be, approving the entry into this Agreement by the Selling Shareholder, the performance by the Selling Shareholder of its obligations herein and the completion of the transactions contemplated hereby.

As soon as practicable after the Closing, the Selling Shareholder shall deliver or cause to be delivered to the Purchaser the original share certificate in the name of the Purchaser, dated as of the Closing Date and duly executed on behalf of the Company, representing the Subject Shares purchased by the Purchaser pursuant to <u>Section 2.1</u>.

Section 2.6 <u>Closing Deliverables by the Purchaser</u>. At the Closing, the Purchaser shall deliver or cause to be delivered to the Selling Shareholder:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an amount in cash equal to the Purchase Price, by check or wire transfer in immediately available funds to a bank account designated in writing by the Selling Shareholder at least ten Business Days prior to the Closing Date; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) an irrevocable instrument of transfer in respect of the Subject Shares being sold by the Selling Shareholder to the Purchaser executed by the Purchaser in the form attached as <u>Exhibit A</u> to this Agreement.

**ARTICLE III**

**<u>Representations and Warranties of the Selling Shareholder</u>**

The Selling Shareholder hereby represents and warrants to the Purchaser as of the date hereof and as of the Closing Date, except if a representation or warranty is made as of a specified date, as of such date, each of the representations and warranties contained in this <u>Article III</u>.

Section 3.1 <u>Organization and Good Standing</u>. The Selling Shareholder is duly organized, validly existing and in good standing under the Laws of the place of its incorporation or formation and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now conducted.

Section 3.2 <u>Title to the Subject Shares</u>. The Selling Shareholder is the sole and exclusive legal record owner of the Subject Shares as of the date hereof and as of the Closing Date, free and clear of any and all Liens. The Selling Shareholder is not a party to any voting trust, proxy, or other agreement or understanding with respect to the voting of any of the Subject Shares, and other than this Agreement to which it is a party, there are no outstanding contracts or understandings to which the Selling Shareholder is a party involving the purchase, sale or other acquisition or disposition of the Subject Shares or any interest therein. Upon consummation of the Closing as provided in <u>Article II</u>, the Purchaser will have good and valid title to the Subject Shares, free and clear of all Liens and restrictions on Transfer (except for restrictions on Transfer under applicable securities Laws) and the Subject Shares shall be validly issued, fully paid and non-assessable with the Purchaser being entitled to all rights accorded to a holder of the Subject Shares. The sale of the Subject Shares pursuant to this Agreement is not subject to preemptive or other similar rights.

Section 3.3 <u>Authorization</u>. The Selling Shareholder has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery and performance of this Agreement by the Selling Shareholder, and the consummation by the Selling Shareholder of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of the Selling Shareholder. This Agreement has been duly executed and delivered by the Selling Shareholder, and assuming due authorization, execution and delivery by the Purchaser, constitutes legal, valid and binding obligations of the Selling Shareholder, enforceable against the Selling Shareholder in accordance with its terms, except as enforcement may be limited by general principles of equity, whether applied in a court of Law or a court of equity, and by applicable bankruptcy, insolvency and similar Law affecting creditors' rights and remedies generally.

ABVC BioPharma, Inc., Share Transfer Agreement 7/18

Section 3.4 <u>Non-contravention</u>. The execution, delivery and performance by the Selling Shareholder of this Agreement do not and will not (i) violate, conflict with or result in the breach of any provision of Organizational Documents of the Selling Shareholder, (ii) conflict with or violate any Law or Order applicable to the Selling Shareholder or the assets, properties or businesses of the Selling Shareholder, or (iii) conflict with, result in any breach of, constitute a default (or event which with the giving of notice or lapse of time, or both, would become a default) under, require any consent under, or give to others any rights of termination, amendment, acceleration, suspension, revocation or cancellation of, any note, bond, mortgage or indenture, contract, agreement, lease, sublease, license, Permit or other instrument or arrangement to which the Selling Shareholder is a party or result in the creation of any Lien upon any of the properties or assets of the Selling Shareholder, other than, in the case of clauses (ii) and (iii) above, any such conflict, violation, default, termination, amendment, acceleration, suspension, revocation or cancellation that are caused by any Person other than the Selling Shareholder or would not, individually or in the aggregate, reasonably be likely to materially affect the authority or ability of the Selling Shareholder to perform its obligations under this Agreement.

Section 3.5 <u>Consents</u>. The Selling Shareholder is under no obligation to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any Governmental Authority or other Person pursuant to any Law in effect on the date hereof in connection with the execution, delivery and performance by the Selling Shareholder of this Agreement and the consummation by the Selling Shareholder of any of the transactions contemplated hereby, except, in each case, for such authorizations, consents, approvals or filings that, if not obtained or made, would not reasonably be expected to, individually or in the aggregate, materially and adversely affect the consummation of the transactions contemplated in this Agreement or the performance by the Selling Shareholder of its obligations hereunder and except for any filing or notification required to be made with the SEC regarding the transactions contemplated under this Agreement.

Section 3.6 <u>No Litigation</u>. There are no Legal Proceedings by or against any of the Selling Shareholder or the Subject Shares pending before any Governmental Authority, or, to the knowledge of the Selling Shareholder, threatened to be brought by or before any Governmental Authority (i) which would be reasonably expected to, individually or in the aggregate, result in a material adverse effect on the authority or ability of the Selling Shareholder to perform its obligations under this Agreement or (ii) that relate to or challenge the validity of this Agreement or the transactions contemplated hereby.

Section 3.7 <u>Broker</u>s. No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Selling Shareholder.

Section 3.8 <u>Exempt Offering</u>. Assuming the accuracy of the Purchaser's representations and warranties in <u>Section 4.7</u> and <u>Section 4.8</u>, the offer and sale of the Subject Shares under this Agreement are or will be exempt from the registration requirements and prospectus delivery requirements of the Securities Act, and from the registration or qualification requirements of any other applicable securities Laws and regulations.

ABVC BioPharma, Inc., Share Transfer Agreement 8/18

**ARTICLE IV**

**<u>Representations and Warranties of the Purchaser</u>**

The Purchaser represents and warrants to the Selling Shareholder, as of the date hereof and as of the Closing Date, except if a representation or warranty is made as of a specified date, as of such date, each of the representations and warranties contained in this <u>Article IV</u>.

Section 4.1 <u>Organization and Good Standing</u>. The Purchaser is duly organized, validly existing and in good standing under the Laws of the place of its incorporation or formation and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now conducted.

Section 4.2 <u>Authorization</u>. The Purchaser has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery and performance of this Agreement by the Purchaser, and the consummation by the Purchaser of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of the Purchaser. This Agreement has been duly executed and delivered by the Purchaser, and assuming due authorization, execution and delivery by the Selling Shareholder, constitutes legal, valid and binding obligations of the Purchaser, enforceable against the Purchaser in accordance with its terms, except as enforcement may be limited by general principles of equity, whether applied in a court of Law or a court of equity, and by applicable bankruptcy, insolvency and similar Law affecting creditors' rights and remedies generally.

Section 4.3 <u>Non-contravention</u>. The execution, delivery and performance by the Purchaser of this Agreement do not and will not (i) violate, conflict with or result in the breach of any provision of Organizational Documents of the Purchaser, (ii) conflict with or violate any Law or Order applicable to the Purchaser or the assets, properties or businesses of the Purchaser, or (iii) conflict with, result in any breach of, constitute a default (or event which with the giving of notice or lapse of time, or both, would become a default) under, require any consent under, or give to others any rights of termination, amendment, acceleration, suspension, revocation or cancellation of, any note, bond, mortgage or indenture, contract, agreement, lease, sublease, license, Permit or other instrument or arrangement to which the Purchaser is a party or result in the creation of any Lien upon any of the properties or assets of the Purchaser other than, in the case of clauses (ii) and (iii) above, any such conflict, violation, default, termination, amendment, acceleration, suspension, revocation or cancellation that are caused by any Person other than the Purchaser or would not affect the Purchaser's ability in material respects to consummate the transactions contemplated herein.

Section 4.4 <u>Consents</u>. The Purchaser is under no obligation to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any Governmental Authority or other Person pursuant to any Law in effect on the date hereof in connection with the execution, delivery and performance by the Purchaser of this Agreement and the consummation by the Purchaser of any of the transactions contemplated hereby, except , in each case, for such authorizations, consents, approvals or filings that, if not obtained or made, would not reasonably be expected to, individually or in the aggregate, materially and adversely affect the consummation of the transactions contemplated in this Agreement or the performance by the Purchaser of its obligations hereunder and except for any filing or notification required to be made with the SEC regarding the transactions contemplated under this Agreement.

ABVC BioPharma, Inc., Share Transfer Agreement 9/18

Section 4.5 <u>No Litigation</u>. There are no Legal Proceedings by or against the Purchaser, pending before any Governmental Authority or, to the knowledge of the Purchaser, threatened to be brought by or before any Governmental Authority (a) which would be reasonably expected to, individually or in the aggregate, result in a material adverse effect on the authority or ability of the Purchaser to perform its obligations under this Agreement or (b) that relate to or challenge the validity of this Agreement or the transactions contemplated hereby.

Section 4.6 <u>Brokers</u>. No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Purchaser.

Section 4.7 <u>Purchase for Own Account; Economic Risk</u>. The Purchaser is acquiring the Subject Shares for investment for its own account and not with a view to the distribution thereof in violation of the Securities Act. The Purchaser acknowledges that it (a) can bear the economic risk of its investment in the Subject Shares, (b) has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Subject Shares and (c) has independently and without reliance upon the Selling Shareholder, and based on such information as it has deemed appropriate, made its own analysis and decision to enter into this Agreement and complete the transactions contemplated hereunder, except that it has relied upon the Selling Shareholder's representations, warranties, covenants and agreements in this Agreement.

Section 4.8 <u>Private Placement; Non-U.S. Person</u>. The Purchaser understands that (a) the Subject Shares have not been registered under the Securities Act or any state securities Laws and (b) the Subject Shares may not be sold unless such disposition is registered under the Securities Act and applicable state securities Laws or is exempt from registration thereunder. The Purchaser represents that either: (i) it is an institutional "accredited investor" (as defined in Rule 501(a) of Regulation D under the Securities Act) or (ii) it is not a U.S. Person and is located outside of the United States, as such terms are defined in Rule 902 of Regulation S under the Securities Act.

**ARTICLE V**

**<u>Covenants and Additional Agreements</u>**

Section 5.1 <u>Further Assurances</u>. Each Party shall take all actions necessary or advisable and do all things (including to execute and deliver documents and other papers) necessary or advisable to consummate the transactions contemplated by this Agreement.

Section 5.2 <u>Confidentiality and Publicity</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Party agrees to: (i) treat and hold as confidential (and not disclose or provide access to any Person to) all confidential information with respect to the other Party, or relating to the transactions contemplated hereby, other than to their respective agents, representatives, Affiliates, employees, existing and potential financing sources and investors, officers and directors who need to know such confidential information, provided that (A) each Party is permitted to disclose information that is required to be disclosed by applicable Law, any Government Authority or applicable securities exchange, including in any filing on or in connection with a Schedule 13D or Schedule 13G, as the case may be, or any amendments thereto, and (B) the Purchaser is permitted to disclose or cause to be disclosed, for the purpose of proposing, discussing, negotiating and executing the Merger or any transaction contemplated by or related to the Merger, information related to the transactions contemplated under this Agreement to BioKey (Cayman) and BioKey (Cayman)'s Affiliates and their respective directors, officers, agents, representatives, employees, existing and potential financing sources and investors, who need to know such confidential information (such disclosure as referred to in clauses (A) and (B), the "<u>Permitted Disclosure</u>"), (ii) in the event that any Party becomes legally compelled to disclose any such information (except for the Permitted Disclosure), provide the other Party with prompt written notice of such requirement so that the other Party may, at its sole cost and expense, seek a protective order or other remedy or waive compliance with this <u>Section 5.2(a)</u>, and (iii) in the event that such protective order or other remedy is not obtained, or the other Party waives compliance with this <u>Section 5.2(a)</u>, furnish only that portion of such confidential information which is legally required to be provided and exercise its reasonable endeavors to obtain assurances that confidential treatment will be accorded such information; <u>provided</u>, <u>however</u>, that this <u>Section 5.2(a)</u> shall not apply to any information that, at the time of disclosure, is in the public domain and was not disclosed in breach of this Agreement by such Party.

ABVC BioPharma, Inc., Share Transfer Agreement 10/18

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Party shall make, or cause to be made, any press release or public announcement in respect of this Agreement or the transactions contemplated hereby or otherwise communicate with any news media without the prior written consent of the Purchaser (in the case of a proposed release or announcement by the Selling Shareholder) or of the Selling Shareholder (in the case of a proposed release or announcement by the Purchaser), unless otherwise required by Law, any Government Authority or applicable securities exchange, provided that the Purchaser, the Company, BioKey (Cayman) and their respective Affiliates (not including, for the avoidance of doubt, the Selling Shareholder) shall be permitted to make press release or public announcement in respect of the Merger or transactions contemplated by or related to the Merger.

Section 5.3 <u>Tax Filing</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as previously disclosed, the Parties have filed all material Tax Returns required to be filed (if any) and have paid all material Taxes required to have been paid (whether or not reflected on any Tax Return). Except as previously disclosed, no Governmental Authority in any jurisdiction has made a claim, assertion or threat to the Parties that the Parties are or may be subject to taxation by such jurisdiction; there are no Liens with respect to Taxes on the Parties property or assets other than Permitted Liens; and there are no Tax rulings, requests for rulings, or closing agreements relating to the Parties for any period (or portion of a period) that would affect any period after the date hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>No Adjustments, Changes</u>. Neither Party nor any other Person on behalf of either Party (a) has executed or entered into a closing agreement pursuant to Section 7121 of the Code or any predecessor provision thereof or any similar provision of state, local or foreign law; or (b) has agreed to or is required to make any adjustments pursuant to Section 481(a) of the Code or any similar provision of state, local or foreign law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>No Disputes</u>. There is no pending audit, examination, investigation, dispute, proceeding or claim with respect to any Taxes of either Party, nor is any such claim or dispute pending or contemplated. The Parties have delivered to each Party true, correct and complete copies of all Tax Returns and examination reports and statements of deficiencies assessed or asserted against or agreed to by either Party, if any, since its inception and any and all correspondence with respect to the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Not a U.S. Real Property Holding Corporation</u>. The Parties are not and have not been United States real property holding corporation within the meaning of Section 897(c)(2) of the Code at any time during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>No Tax Allocation, Sharing</u>. The Parties are not and have not been a party to any Tax allocation or sharing agreement.

ABVC BioPharma, Inc., Share Transfer Agreement 11/18

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>No Other Arrangements</u>. The Parties are not a party to any agreement, contract or arrangement for services that would result, individually or in the aggregate, in the payment of any amount that would not be deductible by reason of Section 162(m), 280G or 404 of the Code. The Parties are not "consenting corporation(s)" within the meaning of Section 341(f) of the Code. The Parties do not have any "tax-exempt bond financed property" or "tax-exempt use property" within the meaning of Section 168(g) or (h), respectively of the Code. The Parties do not have any outstanding closing agreement, ruling request, request for consent to change a method of accounting, subpoena or request for information to or from a Governmental Authority in connection with any Tax matter. During the last two years, neither Party has engaged in any exchange with a related party (within the meaning of Section 1031(f) of the Code) under which gain realized was not recognized by reason of Section 1031 of the Code. The Parties are not a party to any reportable transaction within the meaning of Treasury Regulation Section 1.6011-4.

**ARTICLE VI**

**<u>Indemnification</u>**

Section 6.1 <u>Survival of Representations, Warranties and Covenants</u>. The representations and warranties contained in <u>Article III</u> and <u>Article IV</u> shall survive the Closing until the expiration of the applicable statutory periods of limitations. Notwithstanding the foregoing, any claims asserted by the non- breaching party against the breaching party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation or warranty and such claims shall survive until finally resolved. The covenants and other agreements of each Party contained in this Agreement shall survive the Closing until fully discharged in accordance with their terms. Neither the period of survival nor the liability of any Party with respect to their respective representations, warranties, covenants and agreements shall be reduced by any investigation made or any knowledge acquired at any time by any other Party whether before or after the execution and delivery of this Agreement or the Closing Date.

Section 6.2 <u>Indemnification</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Indemnification by the Selling Shareholder</u>. From and after the Closing, the Selling Shareholder shall indemnify, defend and hold harmless the Purchaser, its Affiliates and their respective officers, directors, employees, agents, successors and permitted assigns (collectively, the "<u>Purchaser Indemnitees</u>") from and against, and shall pay to Purchaser Indemnitees the amount of, or reimburse Purchaser Indemnitees for, all Liabilities, losses, damages, claims, causes of action, costs and expenses (including reasonable attorneys' fees and other expenses incurred in connection with the investigation or defense of any of the same, in responding to or cooperating with any governmental investigation or in enforcing any right to indemnification hereunder), interest, awards, judgments, Taxes, fines and penalties (collectively, "<u>Losses</u>") suffered or incurred by, or imposed upon, the Purchaser Indemnitees (in each case, whether absolute, accrued, conditional or otherwise and whether or not resulting from Third Party Claims) arising out of or relating to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any inaccuracy in or breach of any representation or warranty made by the Selling Shareholder in this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any breach or violation of, or failure to perform, any covenants or agreements of the Selling Shareholder in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Tax Indemnification</u>. The Selling Shareholder shall indemnify and hold harmless the Purchaser from any Losses of the arising out of or relating to any potential transfer Tax, the failure of the Selling Shareholder to comply with its obligations under <u>Section 5.3</u> or any claim or determination by a Tax Authority that the Purchaser be responsible for any withholding or deduction in respect of payments of the Purchase Price under this Agreement (and any related penalties, charges, surcharges, fines and interest relating thereto).

ABVC BioPharma, Inc., Share Transfer Agreement 12/18

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Indemnification by the Purchaser</u>. From and after the Closing, the Purchaser shall indemnify, defend and hold harmless the Selling Shareholder, its Affiliates and their respective officers, directors, employees, agents, successors and permitted assigns (collectively, the "<u>Selling Shareholder Indemnitees</u>") from and against all Losses suffered or incurred by the Selling Shareholder Indemnitees (in each case, whether absolute, accrued, conditional or otherwise and whether or not resulting from Third Party Claims) arising out of or relating to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any inaccuracy in or breach of any representation or warranty made by the Purchaser in this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any breach or violation of, or failure to perform, any covenants or agreements of the Purchaser in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d) Procedures Relating to Indemnification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any Party seeking indemnification under this <u>Section 6.2</u> (an "<u>Indemnified Party</u>") shall promptly give the Party from whom indemnification is being sought (an "<u>Indemnifying Party</u>") notice of any matter which such Indemnified Party has determined has given or would reasonably be expected to give rise to a right of indemnification under this Agreement stating in reasonable detail the factual basis of the claim to the extent known by the Indemnified Party, and containing a reference to the provisions of this Agreement in respect of which such right of indemnification is claimed or arises; <u>provided</u>, <u>however</u>, that the failure to provide such notice shall not release the Indemnifying Party from any of its obligations under this <u>Section 6.2</u> except to the extent the Indemnifying Party is materially prejudiced by such failure. With respect to any recovery or indemnification sought by an Indemnified Party from the Indemnifying Party that does not involve a Third Party Claim, if the Indemnifying Party does not notify the Indemnified Party within thirty (30) days from its receipt of the notice from the Indemnified Party that the Indemnifying Party disputes such claim, the Indemnifying Party shall be deemed to have accepted and agreed with such claim. If the Indemnifying Party has disputed a claim for indemnification (including any Third Party Claim), the Indemnifying Party and the Indemnified Party shall proceed in good faith to negotiate a resolution to such dispute. If the Indemnifying Party and the Indemnified Party cannot resolve such dispute in thirty (30) days after delivery of the dispute notice by the Indemnifying Party, such dispute shall be resolved by arbitration pursuant to <u>Section 7.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If an Indemnified Party shall receive notice of any Legal Proceeding, claim, audit, demand or assessment by any Person who is not a party to this Agreement (each, a "<u>Third Party Claim</u>") against it or which may give rise to a claim for Loss under this <u>Section 6.2</u>, within thirty (30) days of the receipt of such notice, the Indemnified Party shall give the Indemnifying Party notice of such Third Party Claim; <u>provided</u>, <u>however</u>, that the failure to provide such notice shall not release the Indemnifying Party from any of its obligations under this <u>Section 6.2</u> except to the extent that the Indemnifying Party is materially prejudiced by such failure. If the Indemnifying Party acknowledges in writing its obligation to indemnify the Indemnified Party hereunder against any Losses that may result from such Third Party Claim, then the Indemnifying Party shall be entitled to assume and control the defense of such Third Party Claim at its expense and through counsel of its choice reasonably satisfactory to the Indemnified Party if it gives notice of its intention to do so to the Indemnified Party within fifteen (15) days of the receipt of such notice from the Indemnified Party, and the Indemnified Party shall have the right to participate in the defense of such Third Party Claim with counsel selected by it subject to the Indemnifying Party's right to control the defense thereof; <u>provided</u>, <u>however</u>, that if there exists or is reasonably likely to exist a conflict of interest that would make it inappropriate in the judgment of the Indemnified Party in its sole and absolute discretion for the same counsel to represent both the Indemnified Party and the Indemnifying Party, then the Indemnified Party shall be entitled to retain its own counsel in each jurisdiction for which the Indemnified Party determines counsel is required, at the Indemnifying Party's expense. In the event that the Indemnifying Party exercises the right to undertake any such defense against any such Third Party Claim as provided above, the Indemnified Party shall cooperate with the Indemnifying Party in all reasonable respects in such defense and make available to the Indemnifying Party, at the Indemnifying Party's expense, all witnesses, pertinent records, materials and information in the Indemnified Party's possession or under the Indemnified Party's control relating thereto as is reasonably required by the Indemnifying Party. Similarly, in the event the Indemnified Party is, directly or indirectly, conducting the defense against any such Third Party Claim, the Indemnifying Party shall cooperate with the Indemnified Party in all reasonable respects in such defense and make available to the Indemnified Party, at the Indemnifying Party's expense, all such witnesses, records, materials and information in the Indemnifying Party's possession or under the Indemnifying Party's control relating thereto as is reasonably required by the Indemnified Party. No such Third Party Claim may be settled by the Indemnifying Party without the prior written consent of the Indemnified Party. If the Indemnifying Party does not assume the defense of a Third- Party Claim in the manner and within the period provided in this <u>Section 6.2(d)(ii)</u>, or if the Indemnifying Party fails to take reasonable steps necessary to diligently conduct the defense of a Third-Party Claim within five (5) days after receiving written notice from the Indemnified Party to the effect that the Indemnifying Party has so failed, the Indemnified Party may conduct the defense of the Third-Party Claim at the expense of the Indemnifying Party and seek indemnification for any and all Losses based upon, arising from or relating to such Third Party Claim, and the Indemnifying Party shall be bound by any determination resulting from such Third-Party Claim or any compromise or settlement effected by the Indemnified Party. Notwithstanding anything to the contrary in this <u>Section 6.2</u>, unless requested by the Indemnified Party, the Indemnifying Party shall not have the right to defend or direct the defense of any Third Party Claim that seeks an injunction or other equitable relief against the Indemnified Party.

ABVC BioPharma, Inc., Share Transfer Agreement 13/18

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any Indemnified Party and any Indemnifying Party, as the case may be, shall keep the other Person fully informed of the status of any Third-Party Claim and any related Proceeding at all stages thereof where such Person is not represented by its own counsel.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Once a Loss is agreed to by the Indemnifying Party or finally adjudicated to be payable pursuant to this <u>Section 6.2</u>, the Indemnifying Party shall indemnify, pay or reimburse such Loss within fifteen (15) days of such agreement or final, non-appealable adjudication by wire transfer of immediately available funds.

Section 6.3 <u>Certain Limitations</u>. The indemnification provided for in <u>Section 6.2</u> shall be subject to the following limitations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Indemnified Party shall not be entitled to recover under this Agreement or any other agreement or document entered into or delivered concurrent with or in connection with the execution of this Agreement more than once in respect of the same Losses suffered.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In no event shall any Indemnifying Party be liable to any Indemnified Party for indemnification under <u>Section 6.2</u> for any punitive damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The aggregate Liability of any Indemnifying Party under or with respect to this Agreement and the transactions contemplated hereby shall in no event exceed the Purchase Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Notwithstanding anything in this Agreement to the contrary, the limitations on indemnification and liability set forth in this <u>Section 6.3</u> shall not apply to a claim for Losses arising out of fraud or willful misconduct by any Party.

Section 6.4 <u>Tax Treatment of Indemnification Payments</u>. All indemnification payments made under this <u>Article VI</u> shall be treated as adjustments to the aggregate consideration paid to the Selling Shareholder for Tax purposes, unless otherwise required by applicable Law.

Section 6.5 <u>Indemnification Sole and Exclusive Remedy</u>. Following the Closing, indemnification pursuant to this <u>Article VI</u> shall be the sole and exclusive remedy of the Parties and any parties claiming by or through any Party (including the Indemnified Parties) related to or arising from any breach of any representation, warranty, covenant or agreement contained in, or otherwise pursuant to, this Agreement, except in each case pursuant to <u>Section 7.5</u> or in the case of fraud or willful misconduct.

**ARTICLE VII**

**<u>Miscellaneous</u>**

Section 7.1 <u>Expenses</u>. Except as otherwise provided in this Agreement, each Party shall bear its own costs and expenses incurred in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated hereby and thereby.

Section 7.2 <u>Governing Law</u>. This Agreement and any dispute, controversy or claim arising out of or in connection with it or its subject matter shall be governed by, and construed in accordance with, the Laws of the State of New York without regard to its conflicts of laws rules that would mandate the application of the Laws of another jurisdiction.

Section 7.3 <u>Arbitration</u>. Any dispute, controversy or claim arising out of or relating to this Agreement or its subject matter (including a dispute regarding the existence, validity, formation, effect, interpretation, performance or termination of this Agreement) (each a "<u>Dispute</u>") shall be finally settled by arbitration. The place and seat of arbitration shall be New York, and the arbitration shall be administered by the American Arbitration Association (the "<u>ABA</u>") in accordance with the ABA Administered Arbitration Rules then in force (the "<u>ABA Rules</u>"). The number of arbitrators shall be three (3). One arbitrator shall be appointed by the Selling Shareholder, and one arbitrator shall be appointed by the Purchaser. The third arbitrator, who shall serve as chairperson of the arbitral tribunal, shall be selected by the mutual agreement of the arbitrators appointed by the first two Parties. Any arbitrator that is not so appointed shall instead be appointed in accordance with the ABA Rules. The language to be used in the arbitration proceedings shall be English. The award of the arbitral tribunal shall be final, conclusive and binding upon the Parties. Judgment upon any award may be entered and enforced in any court having jurisdiction over a Party or any of its assets. For the purpose of the enforcement of an award, the Parties irrevocably and unconditionally submit to the jurisdiction of any competent court and waive any defenses to such enforcement, including any defenses based on lack of personal jurisdiction or inconvenient forum.

ABVC BioPharma, Inc., Share Transfer Agreement 14/18

Section 7.4 <u>Entire Agreement; Amendments and Waivers</u>. This Agreement (including the schedules and exhibits hereto) represents the entire understanding and agreement among the Parties with respect to the subject matter hereof and thereof. This Agreement can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the Purchaser and the Selling Shareholder. No action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any Party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

Section 7.5 <u>Specific Performance</u>. The Parties acknowledge and agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that, each Party shall be entitled to specific performance of the terms hereof. It is accordingly agreed that, each Party shall be entitled to an injunction or injunctions to prevent such breaches of this Agreement and to enforce specifically (without proof of actual damages or harm, and not subject to any requirement for the securing or posting of any bond in connection therewith) such terms and provisions of this Agreement, this being in addition to any other remedy to which each Party is entitled at law or in equity.

Section 7.6 <u>Notices</u>. All notices and other communications under this Agreement shall be in writing and shall be deemed effectively given (i) when delivered personally by hand (with written confirmation of receipt), (ii) when sent to an e-mail address (absent receipt of a failure to deliver notice within the day of such notice or communication being sent (it being understood that an "out of office" reply does not constitute a failure to deliver notice for this purpose)) or (iii) two (2) Business Days following the day sent by international overnight courier (with written confirmation of receipt), in each case at the following addresses and e-mail addresses (or to such other address or e-mail address as a party may have specified by notice given to the other party pursuant to this <u>Section 7.6</u>):

---

| | | |
|:---|:---|:---|
| (a) | If to the Selling Shareholder, to: | If to the Selling Shareholder, to: |
|  | Attention: | ABVC BioPharma, Inc. |
|  |  | Uttam Patil |
|  | Address: | 44370 Old Warm Springs Blvd. |
|  |  | Fremont, CA 94538 |
|  | Email: | uttam@ambvrivis.com |
| (b) | If to the Purchaser, to: | If to the Purchaser, to: |
|  | Attention: | BioKey, Inc. (Cayman Islands) |
|  |  | Eugene Jiang |
|  | Address: | 44370 Old Warm Springs Blvd. |
|  |  | Fremont, CA 94538 |
|  | Email: | eugene.jiang@ambrivis.com |

---

Section 7.7 <u>Severability</u>. If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any law or public policy, all other terms or provisions of this Agreement shall nevertheless remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the Parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

Section 7.8 <u>Binding Effect; Assignment</u>. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. No assignment of this Agreement or of any rights or obligations hereunder may be made by (i) the Selling Shareholder, directly or indirectly (by operation of law or otherwise), without the prior written consent of the Purchaser, and (ii) the Purchaser directly or indirectly (by operation of law or otherwise), without the prior written consent of the Selling Shareholder, and any attempted assignment in violation of this <u>Section 7.8</u> shall be void. The Indemnified Persons (other than the Parties), as applicable, are each an express third party beneficiary of the indemnification provided in <u>Article VI</u> of this Agreement.

Section 7.9 <u>Counterparts</u>. This Agreement may be executed in any number of counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement.

\*\* REMAINDER OF PAGE INTENTIONALLY LEFT BLANK \*\*

ABVC BioPharma, Inc., Share Transfer Agreement 15/18

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date first written above.

---

| | |
|:---|:---|
| **ABVC BIOPHARMA, INC.** | **ABVC BIOPHARMA, INC.** |
| By: | */s/ Uttam Patil* |
| Name: | Uttam Patil |
| Title: | CEO |

---

[*Signature Page to Share Transfer Agreement*]

ABVC BioPharma, Inc., Share Transfer Agreement 16/18

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date first written above.

---

| | |
|:---|:---|
| **BIOKEY, INC. (CAYMAN)** | **BIOKEY, INC. (CAYMAN)** |
| By: | */s/ Eugene Jiang* |
| Name: | Eugene Jiang |
| Title: | Authorized Signatory |

---

[*Signature Page to Share Transfer Agreement*]

ABVC BioPharma, Inc., Share Transfer Agreement 17/18

**<u>Exhibit A</u>**

**INSTRUMENT OF TRANSFER**

FOR VALUE RECEIVED $100, (amount) We, **ABVC BioPharma, Inc.** of (transferor) 401 Ryland St., Ste 200-A, Reno, NV, 89502, U.S.A., (address) hereby sell, assign and transfer unto **BioKey, Inc. (Cayman)** (transferee) of Corporate Filing Services Ltd., (Cayman Islands) P.O. Box 61, 3<sup>rd</sup> Floor Harbour Centre, North Church Street, Grand Cayman, KYI-1102, Cayman Islands,(address) 7,418,134 shares of common stock, 7,000,000 shares of Series A preferred stock, 1,160,000 shares of Series B preferred stock, and 13,973,097 shares of Series C preferred stock which accounts for all of the Company Stock issued and outstanding of the Company **BioKey, Inc. (California)**.

Dated this 10th day of MAY, 2025

---

| | |
|:---|:---|
| Uttam Patil, CEO of ABVC BioPharma, Inc. | Witness |
| For and on behalf of |  |
| ABVC BioPharma, Inc. |  |

---

---

| | |
|:---|:---|
| Signed by the Transferee: | In the presence of: |
| *Eugene Jian, CEO of BioKey, Inc. (Cayman)* | Witness |
| For and on behalf of BioKey, Inc. (Cayman) |  |

---

ABVC BioPharma, Inc., Share Transfer Agreement 18/18

## Exhibit 10.7

**Exhibit 10.7**

![](ea029154601_ex10-7img1.jpg)

**Supply And Distribution Agreement**

**Between**

**Biokey Inc.**

**And**

**Define Biotech Co., Ltd.**

![](ea029154601_ex10-7img1.jpg)

**This Supply and Distribution Agreement** **("Agreement"**) shall be signed by the following parties on December 6, 2021 ("**Effective Date**"):

**Biokey, Inc.** ("**Party A**" or "**BIOKEY**"), a company incorporated under the Laws of California and having its principal place of business at [ ]; and

**Define Biotech Co., Ltd.** ("**Party B**" or "**DEFINE**"), a company organized and existing under the Laws of Taiwan, the Republic of China, with its registered office at [ ].

Party A and Party B shall be referred to individually as a "**Party**" and collectively as the "**Parties**".

<u>**Whereas**</u> BIOKEY agrees to hereby grant DEFINE exclusive distribution right and Trademarks (as defined below) use right for the Products (as defined below) in the Territory (as defined below) on the terms and conditions set out below. DEFINE hereby accepts to take the rights and agrees to take supplies of the Product solely from BIOKEY exclusively for the Territory on the terms and conditions set out below.

<u>**Now, therefore, the Parties agree as follows**</u>:

**1.** **Definitions** 

Unless the terms or context of this Agreement otherwise provide, the following terms have the meanings set out below:

1.01 "**BIOKEY**" has the meaning set forth in the preamble;

1.02 "**BIOKEY' Facility**" means the plant where BIOKEY manufactures the Product;

"**Affiliate**" or "**Related Party**" means, with respect to a party, any party that controls, is controlled by or is under common control with such

1.03 party. For the purposes of this definition only, "**control**" means (a) to possess, directly
or indirectly, the power to direct the management or policies of a party, whether through ownership of voting securities, by contract
relating to voting rights or corporate governance or otherwise, or (b) to own, directly or indirectly,
fifty percent or more of the outstanding voting securities or other ownership interest of such party;

![](ea029154601_ex10-7img1.jpg)

1.04 "**Agreement**" has the meaning set forth in the preamble;

1.05 "**Applicable Law**" means all applicable laws, rules regulations and guidelines or other
requirements of the Regulatory Authority that may be in effect from time to time;

1.06 "**Approval**" means any and all approvals, permits, operating licenses, ratifications, registrations,
consents, record-filings or other form of permission issued by any regulatory or government body in US and Taiwan in the exercise of its
functions under the applicable law, and "**Approve**" shall be construed accordingly;

1.07 "**Business Day**" means a day other than a Saturday, Sunday or a day that is a bank holiday
in US and Taiwan;

1.08 "**Certificate of Analysis**" means, with respect to each Product provided by BIOKEY under
this Agreement, a certificate issued by BIOKEY (i) stating BIOKEY's name, the description of such Product as listed on DEFINE Purchase
Order, the Product code as listed on DEFINE Purchase Order, the Product Batch number, date of manufacture, date of release, expiration
date, quantity of shipment, each assay/test and method number, the Specification limits of each assay/test, the physical, chemical, biological
or other test results and % label claim for each compound, the correct units of measure to be reported with all assorted values, and the
Specifications of or relating to such Product, and (ii) containing a quality signature and date certifying that such Product is in compliance
with the Specifications and such other agreed-upon requirements of the Parties for the manufacture and packaging of such Product, and
that the materials used in the manufacture of such Product meet the appropriate requirements of Applicable Law;

1.09 "**Certificate of Compliance**" means with respect to each Product provided by BIOKEY to DEFINE under this Agreement,
a certificate issued by BIOKEY (i) stating the name of such Product as listed on DEFINE Purchase Order, the Product code as listed on
DEFINE Purchase Order, the date of release, the DEFINE Purchase Order number, the Batch number, the quantity of shipment, the date of
manufacture, and the expiration date, and (ii) stating that such Product is in compliance with the Specifications concerning packaging
and that such Product has been manufactured in accordance with cGMP, the Specifications and Applicable Law, and manufacturing standards
accepted by US FDA, and Taiwan Regulatory Authority;

![](ea029154601_ex10-7img1.jpg)

1.10 "**cGMP**" means the current Good Manufacturing Practices as in force in the US FDA at the
Effective Date subject to any updates as notified by DEFINE to BIOKEY from time to time;

1.11 "**Collection Date**" means the date notified in writing by BIOKEY to DEFINE that any delivery
of the Product is ready for collection by DEFINE from BIOKEY;

1.12 "**Commercial Flow Data**" shall have the meaning set forth in clause 10.04;

1.13 "**Confidential Information**" shall have the meaning set forth in clause 17.01;

1.14 "**Confirmed Delivery Date**" shall have the meaning set forth in clause 5.09;

1.15 "**Confirmed Order**" shall have the meaning set forth in clause 5.03;

1.16 "**Delivery Date**" means the date the Product is ready for delivery to DEFINE;

1.17 "**Effective Date**" has the meaning set forth in the preamble;

1.18 "**Force Majeure**" shall have the meaning given in clause 18;

1.19 "**Initial Term**" shall have the meaning set forth in clause 20;

1.20 "**DEFINE**" has the meaning set forth in the preamble;

1.21 "**Manufacturing Cost**" means BIOKEY' fully loaded manufacturing cost, being BIOKEY' standard costs as applied
uniformly to all products produced in the BIOKEY' Facility, covering the costs of materials, utilities, direct labor, factory overheads
and depreciation but without including a charge for idle capacity, and the calculation of costs shall be in compliance with international
accounting standards (IAS/IFRS);

1.22 "**Marketing Authorization**" means an approval or authorization from the appropriate Regulatory Authorities as required
to permit Licensee to register, promote, market, distribute and sell the Product in the Territory;

1.23 "**MOQ**" shall have the meaning set forth in clause 5.02;

1.24 "**TW**" means Taiwan, the Republic of China

1.25 "**Product**" means the product(s) listed in Appendix 1;

1.26 "**Purchase Order**" means a purchase order submitted by DEFINE to BIOKEY, in BIOKEY' standard form, in connection
with the supply of the Product to DEFINE in accordance with this Agreement;

1.27 "**Quarter**" means a period of 3 months commencing on 1 January, 1 April, 1 July and 1 October;

![](ea029154601_ex10-7img1.jpg)

1.28 "**Regulatory Approval**" means, any and all approvals, licenses, registrations, or authorizations of any Regulatory
Authority necessary to market any dietary supplement in such country, including, where applicable, (i) the Marketing Authorization application
filed with the Regulatory Authority, and all variations thereto; (ii) pricing or reimbursement approval in such country, (iii) pre-and
post-approval Marketing Authorizations (including any prerequisite manufacturing approval or authorization related thereto), (iv) labeling
approval, and (v) an import permit;

1.29 "**Regulatory Authority**" means any and all governmental bodies, organizations and agencies whose approval is necessary
to manufacture, store, import, transport, market, promote, sell, distribute and use the Product;

1.30 "**NTD**" or "**NT$**" or "**TWD**" means New Taiwan Dollar, the lawful currency of Taiwan;

1.31 "**SIAC**" shall have the meaning set forth in clause 33.02;

1.32 "**Specification**" means the technical and functional requirements and specifications applicable to the Product as agreed
in writing between the parties from time to time;

1.33 "**Supply Price**" shall have the meaning given in clause 15.01;

1.34 "**Term**" means the time period (Including the Initial Term) in respect of which this Agreement continues in force as
determined in accordance with clause 20;

1.35 "**Territory**" means the Taiwan, the Republic of China and Mainland China, the People's Republic of China;

1.36 "**Third-Party**" means any legal entity other than the Parties to this Agreement and their respective Affiliates;

1.37 **"Trademarks"** means trademarks of Product; and

1.38 "**United States Dollars**" or "**US$**" or "**USD**" means the lawful currency of the
United States of America.

**2.** **Interpretation** 

In this Agreement, unless the context requires otherwise:

2.01 A reference to the designee of a Party is a reference to a person or entity selected by such Party in its sole and absolute discretion;

![](ea029154601_ex10-7img1.jpg)

2.02 A reference to an article, clause, paragraph or schedule is, unless stated otherwise, a reference to an
article clause or paragraph of, or schedule to, this Agreement;

2.03 A reference to this Agreement or to any other contract or agreement or document referred to in this Agreement
is a reference to this Agreement or such other contract, agreement or document as amended or novated (in each case, other than in breach
of the provisions of this Agreement) from time to time;

2.04 A reference to an "entity" shall include any company, corporation or other business entity,
wherever and however incorporated or established;

2.05 A reference to a word in the singular shall include the plural and in the plural include the singular;

2.06 A reference to writing or written includes e-mail;

2.07 A reference to a particular time of day is, unless stated otherwise, a reference to that time in Taiwan,
and references to a day are to a period of twenty-four (24) hours running from midnight on the previous day;

2.08 A reference to a Party shall include that Party's personal representatives, successors and permitted assigns;

2.09 A reference to "including" or "includes" does not limit the scope of the meaning of
the words preceding it; and

2.10 The headings in this Agreement do not affect its interpretation.

**3.** **Distribution right** 

3.01 BIOKEY grants distribution rights and obligations in respect of the Products which shall cover activities
such as marketing and promotion of the Products, including but not limited to advertisement, education, exhibition, deployment of promoting
forces, and message management; and management of supply, import and distribution of Product in the Territory (including but not limited
to tenders, orders, invoices, and inventory management).

3.02 DEFINE shall also make all commercially reasonable efforts to ensure that the first-tier distributor or
any subsequent distributor appointed by DEFINE adequately supplies to the channel of sales in the Territory to meet such demands from
time to time.

3.03 Both Parties agree (i) BIOKEY will not appoint another party for any commercial activities of the Products
in the Territory unless approved by DEFINE; (ii) BIOKEY shall not sell the Products to any party in the Territory unless under the instruction
of DEFINE; (iii) DEFINE and its Affiliates will
purchase the Products only from BIOKEY; and (iv) DEFINE shall not and shall procure its Affiliates not to, sell or solicit sales of the
Product outside the Territory.

![](ea029154601_ex10-7img1.jpg)

**4.** **Supply** 

4.01 DEFINE undertakes, during the Term, to obtain its requirements for supplies of the Product from BIOKEY,
and BIOKEY shall, subject to it not being prevented or prohibited by any circumstances beyond its reasonable control, execute such orders
to the best of its ability.

4.02 Unless otherwise agreed under clause 4.03, the Product will be supplied as final packs ready for consumer
use.

4.03 If DEFINE changes the packaging specifications or apply for sub-packaging or local manufacturing in the
Taiwan due to Territory market needs, BIOKEY must at DEFINE's cost use its commercially reasonable efforts to provide DEFINE with
all materials required to facilitate DEFINE's registration application in the Taiwan.

**5.** **Forecasts, ordering and delivery** 

5.01 DEFINE shall provide BIOKEY with an eighteen (18) months' rolling forecast, updated on a quarterly
basis, at least ten (10) Business Days before the start of each Quarter. Each forecast shall show DEFINE's requirements for each
Product on a monthly basis. The first four (4) months (only) of each forecast shall be binding, and shall be the basis for Purchase Orders
to be made in accordance with the other provisions of this clause.

DEFINE 應向 BIOKEY 提供十八（18）個月的滾動預測，每季度更新一次，每個季度至少十（10）個工作日。 每個預測應每月顯示 DEFINED 對每個產品的要求。每個預測的前四（4）個月（僅）應具有約束力，並應作為根據本條款其他規定下達採購訂單的基礎。

The remaining fourteen (14) months of each forecast are non-binding. The minimum order quantity ("**MOQ**") of each Product is listed in Appendix 1 which based on production of a single batch size. Purchase Orders shall be for this MOQ or a multiple of this MOQ.

每個預測的剩餘十四（14）個月不具有約束力。附錄 1 列出了每種產品的最低訂購量（"最小起訂量"），該數量基於單個批量大小的生產。 採購訂單應為該最小起訂量或該最小起訂量的倍數。

![](ea029154601_ex10-7img1.jpg)

5.02 Purchase Orders shall be for the Product to be delivered in four (4) months after the date of order. BIOKEY
shall use its reasonable commercial efforts to reply whether the Purchase Orders can be satisfied in
writing but not later than ten (10) days after receipt of a firm binding written Purchase Order made by DEFINE;

採購訂單應在訂購之日起四 （4） 個月內交付產品。BIOKEY 應盡其合理的商業努力，在收到 DEFINED 發出的具有約束力的書面採購訂單後十（10）天內，以書面形式回復採購訂單是否可以滿足;

BIOKEY will be deemed to have accepted the Purchase Order if it fails to reply during such period, and such Purchase Order will have the same effect as if it had been confirmed by BIOKEY (in both cases above, the "**Confirmed Order**"). No Purchase Order or Delivery Date is binding until such written confirmation is given by BIOKEY.

如果 BIOKEY 在此期間未能回復，則 BIOKEY 將被視為已接受採購訂單，並且該採購訂單將具有與 BIOKEY 確認相同的效果（在上述兩種情況下，均為"已確認訂單"）。 在 BIOKEY 提供此類書面確認之前，任何採購訂單或交貨日期均不具有約束力。

5.03 BIOKEY is entitled to supply up to ±15% of the quantity of any Product ordered by DEFINE.

BIOKEY 有權提供定義訂購的任何產品數量的±15%。

5.04 The terms and conditions of this Agreement shall prevail if the terms and conditions stated in any Purchase
Order(s) or in any other communication from DEFINE relating to the Purchase Order (unless specifically accepted by BIOKEY in writing)
are inconsistent with these terms and conditions.

如果任何採購訂單或DEFINED 與採購訂單有關的任何其他通信中所述的條款和條件（除非 BIOKEY 以書面形式明確接受）中規定的條款和條件與這些條款和條件不一致，則以本協定的條款和條件為準。

5.05 Each delivery shall be accompanied by an advice note specifying (a) name of BIOKEY as manufacturer, (b)
DEFINE's Product denomination, (c) DEFINE's order no., (d) DEFINE's Product no., and (e) quantity.

每次交付均應附有一份通知書，詳細說明（a）BIOKEY 作為製造商的名稱，（b）DEFINE 的產品面額，（c）DEFINE 的訂單號，（d）DEFINE 的產品編號和 （e）數量。

5.06 Unless otherwise agreed upon, the Product shall be delivered on authorized US-pallets.

除非另有約定，否則產品應通過授權的美國托盤交付。

![](ea029154601_ex10-7img1.jpg)

5.07 The delivery of Product by BIOKEY to DEFINE is CIF (incoterms) Taiwan (or other ports as notified by DEFINE
subsequently). On the written request from DEFINE, it can be changed to EXW (incoterms).

BIOKEY 向 DEFINE 交付的產品是 CIF（ 國際貿易術語解釋通則） 臺灣（ 或DEFINE 隨後通知的其他港口）。在 DEFINE 的書面請求中，可以將其更改為EXW（國際貿易術語解釋通則）。

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| | |
|:---|:---|
| **6** | **Manufacturing Information, Manufacturing, Quality And Release, Ongoing Stability** |

---

6.01 BIOKEY shall manufacture the Product (i) in accordance with the Specification; (ii) in accordance with
cGMP's; (iii) in accordance with all other applicable laws and regulations applying at the BIOKEY' Facility; and (iv) other
requirements as may be agreed in writing between DEFINE and BIOKEY from time to time.

6.02 No changes shall be made to the Specification of the Product without the specific prior written consent
of DEFINE. If DEFINE requires any change to the Specification, DEFINE will bear all fees and the reasonable costs of such change. If any
such change will result in any increase to BIOKEY' cost for supply of the Product to DEFINE, then both parties shall agree a fair
and reasonable increase in the Supply Price.

6.03 BIOKEY shall be responsible for ensuring the quality of all Product manufactured for DEFINE under this
Agreement in accordance with reasonable analytical methods supplied or approved by DEFINE.

6.04 BIOKEY shall provide DEFINE with a Certificate of Analysis and a Certificate of Compliance (signed by
a "qualified person" as designated by BIOKEY) for each batch delivered to confirm that Product then delivered meet all the Specification,
and have been manufactured in compliance with all requirements of cGMP and the Specification.

6.05 BIOKEY shall be responsible for QP "release" of the Product, and maintaining all necessary Approvals
at BIOKEY' Facility.

6.06 Product shelf life is listed in Appendix 1. BIOKEY shall use all reasonable commercial efforts to ensure
that all Product supplied to DEFINE have the maximum shelf life available at the time of delivery relative to the approved shelf life
(i.e., as approved by the Regulatory Authorities), with a target and norm that the remaining shelf life at the time of delivery is not
less than 85% of the approved shelf life.

6.07 If BIOKEY delivers Product to DEFINE that does not meet the Specification, DEFINE has a right within ten
(10) Business Days from delivery to reject such Product. DEFINE shall inform BIOKEY of its rejection, and its reasons for rejection, and
provide the information required by BIOKEY to identify the Product.

![](ea029154601_ex10-7img1.jpg)

6.08 If BIOKEY supplies Product which do not meet the quality standards set forth in clause 6.01, DEFINE can
return the defective Product to BIOKEY. Upon confirmation of the reasons for return, BIOKEY shall either replace the defective Product
or refund the price at which DEFINE purchased the defective Product. BIOKEY is also liable to DEFINE for any reasonable loss and damages
caused by such quality failure of BIOKEY.

6.09 If the parties fail to agree on the reasons for the rejection (or in case of a latent defect of the revocation
of the acceptance) of the Product, either party may refer the matter for final analysis to a specialized laboratory of international reputation
acceptable to both parties for the purpose of determining the results. Any determination by such laboratory analysis shall be final and
binding upon the parties. The cost and expense of such laboratory shall be borne by DEFINE if the laboratory determines that the Product
are in compliance with the Specification or by BIOKEY if the laboratory determines that the Product do not meet the requirements of the
Specification.

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| | |
|:---|:---|
| **7** | **Quality Agreement** |

---

Supplies of all Products by BIOKEY to DEFINE under this Agreement shall also be subject to the terms and conditions of a Quality Agreement in a form as reasonably required by BIOKEY. As soon as possible after the Effective Date, the parties will finalize and enter into the Quality Agreement. In the event of any inconsistencies between this Agreement and the Quality Agreement, the provisions of this Agreement shall prevail.

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| | |
|:---|:---|
| **8** | **Labelling** |

---

If DEFINE needs to make any changes, it shall supply to BIOKEY ready artwork copy or other material produced by DEFINE for the trade dress, labels, leaflets, or other product inserts and printed materials to be affixed or packaged with the Product and for the packaging materials used for the Product. BIOKEY shall return the print proofs in Acrobat PDF format within five (5) Business Days from receipt of DEFINE's native artwork files. BIOKEY shall not make any changes to the artwork copy or other materials submitted by DEFINE without the prior written approval of DEFINE. Should changes be necessary to artworks, DEFINE agrees to promptly supply new artworks. DEFINE shall reimburse BIOKEY's actual costs of scrapping packaging or labelling materials which were purchased or ordered for DEFINE's demands of the Product as specified in the first six (6) months of a forecast made in accordance with clause 5.01 and which can no longer be used due to a change in the artwork.

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| | |
|:---|:---|
| **9** | **Trademark** |

---

9.01 BIOKEY grants Trademark use rights and obligations to DEFINE in respect of the Products. DEFINE agrees
the Trademark for display solely in connection with the marketing, advertising, and promotion of the Products.

![](ea029154601_ex10-7img1.jpg)

9.02 DEFINE shall notify BIOKEY of any potential infringement of the Trademarks or claims that any of the Trademarks
infringe the rights of third parties, and that BIOKEY agrees that BIOKEY shall defend the Trademarks at its own discretion and bear all
the associated cost.

9.03 Unless otherwise approved by BIOKEY, DEFINE agrees not to register nationally or internationally the Trademarks,
or trademarks confusingly similar to the Trademarks. DEFINE confirms and acknowledges that, except as provided in this clause 9, it shall
not have any rights in respect of the know-how or the Trademarks or of the goodwill associated with them for the Products and that all
such rights and goodwill are, and shall remain, vested in BIOKEY.

9.04 Upon termination of the Agreement, DEFINE shall cease to use or display the Trademarks.

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| | |
|:---|:---|
| **10** | **Marketing and Distribution Obligations** |

---

10.01 DEFINE shall distribute the Product in the Territory in accordance with all legislative and regulatory
requirements and other applicable industry codes of practice in the Territory.

10.02 DEFINE undertakes during the period of this Agreement in respect of the Product:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) not to seek customers or maintain any distribution depot outside the Territory; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) not to sell or otherwise supply the Product to any person within the Territory for the purpose of supplying or selling the Product
outside the Territory.

10.03 DEFINE shall act as the agent of BIOKEY for the Regulatory Approval of the Products *，* be responsible for all the tendering work of the Products in the Territory. DEFINE has freedom to decide the offer price of each tender.

DEFINE shall execute all the tendering affairs including, but not limited to, delivery of tender information, communication and connection with government authority in accordance with policies and requirements in the Territory. In the event of failure to submit tenders accurately and timely due to the reasons of DEFINE, BIOKEY shall have the right to claim compensation from the DEFINE for all the direct losses caused to BIOKEY (including reasonable costs such as legal fees, litigation fees, travelling costs, etc.).

10.04 DEFINE agrees to provide customer records to BIOKEY on a monthly basis. This includes monthly sales to
hospital and pharmacy by province, and selling prices.

During the Term of this Agreement, DEFINE shall, within the first five (5) working days of each month, require the distribution company in the Territory to provide timely, accurate and complete sales flow, purchase, sales and inventory data ("**Commercial Flow Data**") of the Products in the last month (as of the last working day), to BIOKEY in writing or by email according to the format and content required by BIOKEY. DEFINE should ensure that the Commercial Flow Data is timely, true, accurate and complete.

![](ea029154601_ex10-7img1.jpg)

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| | |
|:---|:---|
| **11** | **MINIMUM PURCHASES** |

---

11.01 In this Clause:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) "**Minimum Quantity**" means the minimum number of packs of the Product to be purchased by
DEFINE from BIOKEY for the Year in question as listed in Appendix 2; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) "**Year**" means a period of twelve (12) months starting on 1 January of any year.

11.02 If, in respect of any Year, DEFINE fails to make purchases from BIOKEY equal to the Minimum Quantity,
then in respect of the shortfall, except (and to the extent that) that any such shortfall is due to a failure of supply by BIOKEY, DEFINE
shall pay to BIOKEY one (1) time of the Supply Price multiplied by the volume of the shortfall (refer to the description of Supply Price
under clause 15.01).

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| | |
|:---|:---|
| **12** | **RECORDS, SAMPLES, INSPECTION** |

---

12.01 Throughout the Term BIOKEY will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) keep at its premises reasonable and accurate records relating to BIOKEY's manufacture of the Product
including but not limited to keeping throughout the Term, records showing:

- details relating to the manufacture of the Product as required by cGMP; and

- details of all quality control testing undertaken in respect of the manufacture of the Product as required by cGMP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) maintain and retain for a period equal to the shelf life of the Product plus twelve (12) months, notwithstanding the termination
of this Agreement (for whatever reason), requisite documentation of the accounts and records, correspondence, contracts and any other
documents relevant to the manufacture and supply of the Product;

![](ea029154601_ex10-7img1.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) in accordance with cGMP, maintain retention samples from each batch of Product manufactured provided that
the number of retention samples retained by BIOKEY must always be sufficient in number to enable:

- all attributes of the Product to be fully tested at least twice; and

- one sample to continue to be held as a retention sample for the period of its shelf life plus twelve (12) months.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) provide to DEFINE (or its nominee), whenever requested, one or more of the retention samples contemplated by this clause.

12.02 Notwithstanding any other provision of this clause, BIOKEY shall not destroy any documentation relating
to the manufacture of the Product or any retention samples without first asking DEFINE if DEFINE wishes to take over storage arrangements
itself.

12.03 BIOKEY will notify DEFINE of any critical adverse findings of any audit by any Regulatory Authority relevant
to or relating to the manufacture of the Product.

12.04 DEFINE's QA inspectors shall have the right, not more than once every year during the first three
(3) years of the Term and then every two years (except in the event of an emergency relating to the Product) from the Effective Date to
access BIOKEY' Facility to inspect manufacture of the Product in accordance with the provisions of this Agreement. Any such inspections
shall be carried out by not more than two (2) inspectors over three (3) Business Days after giving at least ten (10) weeks' written
notice to BIOKEY during normal business hours at a time mutually convenient to the parties (acting reasonably). However, in the event
of a "for cause" inspection, BIOKEY shall grant DEFINE's QA inspectors' access as soon as it reasonably can within
ten (10) Business Days.

12.05 Notwithstanding any other provision of this Agreement, BIOKEY will not be obliged to grant any access
or inspection pursuant to this Agreement unless the person proposed to be granted such access or inspection first agrees to comply with
(a) such conditions of confidentiality as BIOKEY reasonably and usually requires, and (b) all reasonable instructions, including BIOKEY'
health and safety and security policies and guidelines, to apply at all times during such inspection.

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| | |
|:---|:---|
| **13** | **REGULATORY** |

---

13.01 DEFINE shall be solely responsible for all contacts and communications with any Regulatory Authority in
Taiwan with respect to all matters relating to the Product.

13.02 DEFINE shall notify BIOKEY as soon as possible after it receives any contact or communication from any
Regulatory Authority in Taiwan that in any way relates to the Product. DEFINE shall as soon as reasonably possible provide BIOKEY with
copies of all communications received from or sent to any such Regulatory Authority with respect to the Product. DEFINE shall consult BIOKEY regarding the
response to any inquiry or observation from such Regulatory Authority relating to the Product.

![](ea029154601_ex10-7img1.jpg)

13.03 The Parties agree to report any serious adverse drug event in accordance with the procedure as required
by Regulatory Authority and DEFINE. A separate pharmacovigilance agreement shall be signed for this purpose at least 3 (three) months
before product launch in the Territory.

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| | |
|:---|:---|
| **14** | **PRODUCT RECALL** |

---

14.01 If BIOKEY or DEFINE becomes aware of any safety issue or event that may give rise to any possible or actual
recall of the Product, BIOKEY or DEFINE shall, within 36 (thirty- six) hours, advise the other by telephone, telefax, or email, of such
issue, and BIOKEY and DEFINE shall agree on an appropriate course of action within 3 (three) days. In the event of a product recall, whether
such recall was i) ordered by any governmental agency or authority, or ii) initiated by BIOKEY, DEFINE shall abide by the instructions
of BIOKEY and shall immediately cease distribution of the Product and shall take all appropriate actions to recall such product.

14.02 In the event a recall is attributable to the negligence of DEFINE or its Affiliates, DEFINE will bear
all cost of such recall and indemnify BIOKEY for all expenses incurred by BIOKEY, or its Affiliates with regard to such recall.

14.03 In the event a recall is attributable to BIOKEY's negligence, BIOKEY will bear all expenses of such
recall and indemnify DEFINE and its Affiliates for all expenses incurred by DEFINE or its Affiliate with regard to such recall and reimburse
the costs paid by DEFINE for the product recalled.

14.04 For the purposes of this agreement, expenses of recall include, without limitation to the amount, the
expenses of notification and destruction or return of the recalled product.

14.05 In the event of a product recall or similar action, DEFINE agrees to maintain and make available to BIOKEY
for inspection a current written record of names and addresses of its customers and quantity of purchase and recall, which will be maintained
in confidence. DEFINE agrees to accept auditing from BIOKEY or auditor assigned by BIOKEY.

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| | |
|:---|:---|
| **15** | **PRICES, INVOICING, PAYMENT TERMS** |

---

15.01 Subject to the provision of 5.08 and the provisions below, the price ()"**Supply Price**") for supplies of the Product CIF (Incoterms 2010) by BIOKEY to DEFINE shall be based on the list in Appendix 1,
 which represents the Manufacturing Cost of BIOKEY. Unless otherwise mutually agreed in writing between the Parties, this Supply
 Price shall apply to all Product which are subject to Purchase
Orders sent by DEFINE to BIOKEY during the Initial Term.

根據第 5.08 條的規定和以下規定，BIOKEY 向 DEFINED 提供的產品 CIF（2010 年國際貿易術語解釋通則）的供應價格（"供應價格"）應基於附錄 1 中的清單， 該清單代表 BIOKEY 的製造成本。除非雙方另有書面約定，否則本供應價格應適用於在初始期限內由 DEFINED 向 BIOKEY 發送的採購訂單約束的所有產品。

![](ea029154601_ex10-7img1.jpg)

15.02 In addition to the Supply Price, BIOKEY shall invoice DEFINE for the cost of transport and shipping (including
insurance) from BIOKEY' Facility to DEFINE's nominated delivery point. A standard rate for each pack can be set, with reference
to the actual transport and shipping costs (including insurance, based on the Supply Price in clause 15.01), to be agreed by both parties.

除供應價格外，BIOKEY 還應就從 BIOKEY 的設施到 DEFINICE 指定的交付點的運輸和運輸（包括保險）費用開具 DEFIND 的發票。可以參考實際運輸和運輸成本（包括保險，基於第15.01 條中的供應價格）設定每個包裝的標準費率，由雙方商定。

15.03 Based on confirmed order by DEFINE, BIOKEY shall invoice DEFINE with a 10% security deposit in cash with
a 180-day promissory note. BIOKEY should deliver the order within 60 days of the established delivery date set in 5.01. DEFINE will check
out the actual sales quantity each month, and issue a 45-day promissory note for payment.

訂單確認 DEFINE 以 180 天期票交付 10%訂金，BIOKEY 於訂單確認後須於 60 天內交貨，DEFINE 依每個月實際銷售數量結帳，開立 45 天期票給予 BIOKEY 支付貨款。

15.04 If payments from DEFINE are outstanding, then BIOKEY shall be entitled to stop processing all Purchase
Orders in hand or placed subsequently until all outstanding payments have been settled.

如果 DEFINED 的付款未付款項，則 BIOKEY 有權停止處理手頭的所有採購訂單或隨後下達的訂單，直到所有未付款項都已結清。

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| | |
|:---|:---|
| **16** | **REPRESENTATIONS AND WARRANTIES BY EACH PARTY** |

---

Each Party represents and warrants to the other Party, on the Effective Date that:

16.01 It is a legal entity that has been duly established, and is validly existing in good standing under the
laws of its incorporation;

![](ea029154601_ex10-7img1.jpg)

16.02 It has all due and valid power and authority necessary to execute this Agreement and carry out its obligations
hereunder;

16.03 This Agreement is a valid and legally binding obligation of such Party, enforceable against said Party
in accordance with its terms, and will not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) breach or constitute a default under any of its corporate documents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) result in a breach, default, mediation, termination or acceleration under any agreement to which it is
bound;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) require consent to be obtained, or notice to be given, under any agreement to which it is bound, or give
any governmental authority or Person the right to challenge any of the transactions contemplated herein; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) violate any applicable law or regulation, or any order, judgment or decree of any competent governmental
authority, court or arbitral panel by which it is bound.

16.04 It has not breached any condition contained in any governmental license, permit, approval or authorization
held by it and no such license, permit, approval or authorization has been revoked or proposed to be revoked;

16.05 It is not in the process of receivership, liquidation or dissolution proceedings, and no grounds exist
for the commencement of such proceedings;

16.06 No creditor has taken possession of all or any material part of its business or assets;

16.07 It has not violated any applicable law in such a way that may result in any liability or any criminal
or administrative sanction to another Party; or

16.08 Neither it, nor any of its Affiliates, is the subject of any actual or threatened litigation, arbitration,
administrative or criminal proceedings, or other Third-Party claim, that may have a material adverse impact on such Party's performance
under this Agreement.

---

| | |
|:---|:---|
| **17** | **CONFIDENTIALITY** |

---

In the execution of this Agreement, the Parties may exchange some information.

17.01 For the purpose of this Agreement, "**Confidential Information**" includes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) any business, product, service, processes, data, customers, methods, financial, marketing, technical,
scientific or other non-public information disclosed by any Party, its Affiliates or their agents ()"**Disclosing Party** ")
and third-party information that the Disclosing Party is obligated to keep confidential, which, at the time of disclosure, is designated
as confidential (or a like designation), is disclosed in circumstances of confidence, or would be understood
by the Parties, exercising reasonable business judgment, to be confidential; and

![](ea029154601_ex10-7img1.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) the nature, content and existence of this Agreement, any draft documents negotiated between the Parties,
as well as the respective contents, discussions or negotiations between the Parties of each of the foregoing;

17.02 From time to time before and during the term of this Agreement a Disclosing Party has disclosed or may
disclose Confidential Information to another Party, its Affiliates or their agents ()"**Receiving Party** "). A Receiving
Party shall, until this Agreement is terminated, and thereafter:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) maintain the confidentiality of Confidential Information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) not use Confidential Information for any purposes other than those specifically set out in this Agreement;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) not disclose, without the Disclosing Party's written consent, any Confidential Information to any person
or entity, except to its directors or employees, or the directors or employees of its Affiliates, its agents and advisors who need to
know such information to perform their responsibilities and who have been informed of the confidential nature of the Confidential Information
and have signed written confidentiality terms at least as stringent as the terms provided in this clause 17.

17.03 The obligations in clause 17.02 shall not apply to information that;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) can be shown to be known by the Receiving Party or any of its Affiliates by written records made before
disclosure by the Disclosing Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) is or becomes public knowledge otherwise than through the Receiving Party's breach of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) was obtained by the Receiving Party or any of its Affiliates from a Third Party having no obligation of
confidentiality with respect to such information; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) is independently developed by the Receiving Party or any of its Affiliates without use of any Confidential
Information.

![](ea029154601_ex10-7img1.jpg)

17.04 In the event that a Receiving Party is requested or required by applicable laws, regulations, court orders
or stock exchange rules to disclose any Confidential Information, the Receiving Party agrees that, to the extent permitted by applicable
laws, it will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) immediately upon learning of the disclosure request/requirement, and prior to making any disclosure, provide
the Disclosing Party with written notice of such request or requirement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) cooperate with the Disclosing Party to take proper measures or pursue a judicial injunction or other appropriate
relief to prevent or minimize such disclosure; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) if such disclosure is inevitable, only disclose such Confidential Information to the minimum extent required
by such applicable laws, regulations, court orders or stock exchange rules.

17.05 Upon the expiration or termination of this Agreement or upon the Disclosing Party's request at any time,
the Receiving Party shall (i) return to the Disclosing Party, or at the Disclosing Party's direction destroy, all materials (including
any copies thereof) embodying the Disclosing Party's Confidential Information and (ii) certify in writing to the Disclosing Party, within
ten (10) days following the other Party's request, that all of such materials have been returned or destroyed.

---

| | |
|:---|:---|
| **18** | **FORCE MAJEURE** |

---

18.01 The performance by either Party of any obligation on its part to be performed under this Agreement (other
than an obligation to pay money or issue credit) shall be excused by any event of Force Majeure.

18.02 In the event that a condition of Force Majeure prevents a party from performing any of its material obligations
for more than three (3) months, the party so affected shall exert all reasonable commercial efforts to eliminate, cure, or overcome any
such causes and to resume performance to its obligations with all possible speed. In case the Force Majeure event is continuing for more
than three (3) months and preventing BIOKEY from continuing to supply the Product to DEFINE, so long as such circumstances prevail, DEFINE
has the right to obtain its requirements of the Product from other sources, until BIOKEY is able to resume supply.

---

| | |
|:---|:---|
| **19** | **INDEMNIFICATION** |

---

The Parties should observe to the terms and conditions of this Agreement.

19.01 In the event of failing to abide its responsibilities and obligations by any Party to this Agreement,
the non-defaulting Party shall have the right to seek indemnification from the defaulting Party for all losses resulting from the breach,
including all reasonable direct costs, losses, damages, expenses or liabilities (including but not limited to attorney fees), arising
from or in connection with the Product supply herein.

![](ea029154601_ex10-7img1.jpg)

19.02 The defaulting Party shall indemnify and hold the other non-defaulting Parties and its Affiliates, and
their agents, directors, officers, employees and representatives harmless from any claims, demands, liabilities, suits, or expenses of
any kind against non- defaulting Parties or its Affiliates to the extent arising out of or resulting from (i) any breach of defaulting
Party's representations, warranties or obligations under this Agreement or non-fulfillment or failure to perform any covenant or
agreement made by defaulting Party in this Agreement; or (ii) any other negligent act or omission on the part of defaulting Party or its
Affiliates, or their agents, directors, officers, employees or representatives.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.03 Each party shall notify the other of any claim or potential claim in relation to this Agreement and shall
include sufficient information to enable the other party to assess the facts. Each party shall co-operate fully with the other party in
the defence of all such claims. No settlement or compromise shall be binding on a party without its prior written consent, which consent
shall not be unreasonably withheld.

19.04 In the event of termination of this Agreement, the contractual obligation shall be ceased but not affect
the liability for any indemnification under the clause of this Agreement.

---

| | |
|:---|:---|
| **20** | **TERM** |

---

This Agreement is effective from the Effective Date and, subject to all other provisions of this Agreement, shall remain in force and effect for a period of five (5) years from the Effective Date ("**Initial Term**"). Then, unless terminated at the expiration of the Initial Term by either party giving to the other at least six (6) months' prior written notice, this Agreement shall continue in force automatically for two (2) year renewal periods until terminated by either party giving to the other at least six (6) months' prior written notice to take effect at the end of any such renewal period.

---

| | |
|:---|:---|
| **21** | **EARLY TERMINATION AND RIGHTS ON TERMINATION** |

---

21.01 This Agreement will be terminated automatically if any of the following events happen:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) a Party to provide a one hundred eighty (180) days written notice for early termination to the other Party
and successfully obtain the written consent of all the other Party; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) this Agreement cannot be enforced as a result of Force Majeure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) a Party to provide a written notice for early termination to the other Party according to the terms and
conditions of this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) the Licensing Agreement signed between the two Parties on 2021 Dec [ ] is terminated.

![](ea029154601_ex10-7img1.jpg)

21.02 In case either party:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) withholds from the other for a period of two months or more any amount due to the other under any of the
provisions of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) commits or permits any substantial breach of any of the terms of this Agreement, the non-defaulting Party
can send a written notice for remedy within fifteen (15) days. If the defaulting Party fails to remedy that breach within thirty (30)
days of receiving written notice from the other Party, the non-defaulting Party can send a written notice to the other Party for termination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) has a receiver or administrator appointed in respect of any of its assets, or enter into any arrangement
or composition with its creditors; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) goes into liquidation whether voluntary or compulsory (except for the purpose of reconstruction or amalgamation).

Then the other party shall be at liberty at any time to terminate this Agreement immediately on giving notice in writing to the other party.

21.03 The party terminating this Agreement may, at its option, require that all Purchase Orders issued prior
to the termination of this Agreement be fulfilled pursuant to and subject to the terms of this Agreement in which case all Purchase Orders
issued prior to the expiration of the Term shall be fulfilled and paid for pursuant to and subject to the terms of this Agreement.

21.04 Unless otherwise stipulated in this Agreement, all the rights or liabilities of each Party under this
Agreement will be cancelled automatically after the cancellation or termination of this agreement, except those accrued rights and liabilities
which have to be settled according to this Agreement.

---

| | |
|:---|:---|
| **22** | **NOTICE** |

---

22.01 Mode of giving a notice or other communication

A notice, permission or other communication under or in connection with this Agreement must be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) in
 English *;* 

 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) signed off by the representative(s) upon delivery;

![](ea029154601_ex10-7img1.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) delivered by hand or sent by recorded delivery post to the relevant Party to the contact or address set
out in clause 22.02 of this Agreement (or if otherwise notified by the relevant person under clause 22.03 of this Agreement to such other
contact or address as has been so notified).

22.02 Addresses

The contact and address for each Party is (unless otherwise notified under clause 22.03 of this Agreement):

in the case of BIOKEY as follows:

---

| |
|:---|
| Address: |
| Attention: |
| Email Address: |

---

in the case of DEFINE as follows:

---

| |
|:---|
| Address: |
| Attention: |
| Email Address: |

---

22.03 Each Party may notify other Parties, from time to time, for the purposes, and in accordance with the provisions,
of this clause, of any changes to the address or other details as given above.

---

| | |
|:---|:---|
| **23** | **ASSIGNMENT** |

---

Unless otherwise agreed in this Agreement, A Party may not assign, transfer, charge or deal in any other manner with this Agreement or any of its rights under it (including holding an interest on trust for another), nor purport to do so, nor sub-contract any or all of its obligations under this Agreement without having obtained the prior written consent of the other Party.

---

| | |
|:---|:---|
| **24** | **COMPLIANCE WITH ANTI-CORRUPTION LAWS** |

---

Both parties are committed to conduct business with the highest degree of ethics and integrity and will comply with the letter and spirit of all relevant local and international anti-corruption laws and regulations.

---

| | |
|:---|:---|
| **25** | **COST AND TAX** |

---

Each Party will be responsible for its own costs incurred in connection with the negotiation, preparation, execution and implementation of this Agreement.

![](ea029154601_ex10-7img1.jpg)

All taxes caused by this Agreement shall be borne separately by each Party on its own and in accordance with relevant laws and regulations in that country or region.

---

| | |
|:---|:---|
| **26** | **VARIATION** |

---

A variation of this Agreement is valid when it is in writing and signed by the Parties or signed on its behalf by its authorized representative.

This Agreement may be supplemented by the terms and details of supplemental agreement. If there is any conflict between this Agreement and any of the supplemental agreements, terms of the relevant supplementary agreement shall prevail.

---

| | |
|:---|:---|
| **27** | **WAIVER** |

---

Failure to exercise or a delay in exercising, a right or remedy provided by this Agreement or by law does not constitute a waiver of the right or remedy or a waiver of other rights or remedies. No single or partial exercise of a right or remedy provided by this Agreement or by law prevents the further exercise of the right or remedy or the exercise of another right or remedy. A waiver of a breach of this Agreement does not constitute a waiver of a subsequent or prior breach of this Agreement.

---

| | |
|:---|:---|
| **28** | **RIGHTS AND REMEDIES ARE CUMULATIVE** |

---

The rights and remedies provided by this Agreement are cumulative and do not exclude any rights and remedies provided by law.

---

| | |
|:---|:---|
| **29** | **COUNTERPARTS** |

---

This Agreement may be entered into in any number of counterparts and any Party may enter into this Agreement by executing any counterpart. A counterpart constitutes an original of this Agreement and all executed counterparts together have the same effect as if each Party had executed the same document.

---

| | |
|:---|:---|
| **30** | **INVALIDITY** |

---

If a provision of this Agreement is found to be illegal, invalid or unenforceable, then to the extent it is illegal, invalid or unenforceable, that provision will be given no effect and will be treated as though it were not included in this Agreement, but the validity or enforceability of the remaining provisions of this Agreement will not be affected.

---

| | |
|:---|:---|
| **31** | **LANGUAGE** |

---

This Agreement shall be executed in English.

![](ea029154601_ex10-7img1.jpg)

---

| | |
|:---|:---|
| **32** | **ENTIRE AGREEMENT** |

---

32.01 Entire Agreement

This Agreement constitutes the entire agreement between the Parties hereto in relation to the subject matter of this Agreement and supersedes all discussions, negotiations and agreements between them on the same subject matter made before the Effective Date.

32.02 No reliance on a statement outside this Agreement

Each Party agrees and acknowledges that it has not relied on or been induced to enter into this Agreement by a warranty, statement, representation or undertaking which is not expressly included in this Agreement.

32.03 No remedy for a statement outside this Agreement

No Party has any claim or remedy in respect of a warranty, statement, misrepresentation (whether negligent or innocent) or undertaking made to it by or on behalf of the other Party in connection with or relating to a transaction which is not expressly included in this Agreement.

---

| | |
|:---|:---|
| **33** | **GOVERNING LAW AND DISPUTE RESOLUTION** |

---

33.01 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of Singapore.

33.02 Dispute Resolution

Any dispute, controversy, difference or claim arising out of or relating to this contract, including the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to it shall be discussed and resolved between the **Authorized Officers** from each of the **Parties** first, before referred to and finally resolved by arbitration administered by the Singapore International Arbitration Centre ("**SIAC**") under the SIAC Administered Arbitration Rules in force when the Notice of Arbitration is submitted.

The law of this arbitration clause shall be Singapore law.

The seat of arbitration shall be Singapore.

The number of arbitrators shall be one (1). The arbitration proceedings shall be conducted in English.

33.03 Notwithstanding the foregoing, the Parties agree that both have the right to seek, to the extent permitted
under the laws of any relevant jurisdiction, temporary or permanent injunctive or other similar relief in any court or other authority
of competent jurisdiction in respect of any claims of breach of confidentiality or for an order of specific performance or other injunctive
relief.

*[Below is the signature page]*

![](ea029154601_ex10-7img1.jpg)

**IN WITNESS WHEREOF,** the Parties have caused this Agreement to be executed by themselves or their duly authorized officers, on the day and year first written above.

---

| | |
|:---|:---|
| BIOKEYINC. | DEFINE BIOTECH CO., LTD |
| Name: | Name: |
| Title: | Title: |
| Date: | Date: |

---

![](ea029154601_ex10-7img1.jpg)

**Appendix 1: Product Information**

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Product Name** | **Specification** | **Supply Price** | **Shelf Life** | **MOQ** |
| Maitake Tablet | | $[ ]/tab | [ ] Yrs | [ ] tab |
| Maitake Tablet | | $[ ]/tab | [ ] Yrs | [ ] tab |
| Maitake Drink | | TBD | TBD | [ ] L |
| Maitake Drink | | TBD | TBD | [ ] L |

---

**Note:**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The total order for the first will be US$[ ] (Taiwan Dollar [ ]) (exchange rate 27.72) with a prepaid deposit of [ ]% US $[ ] (Taiwan Dollar [ ]) (exchange rate 27.72)

第一年訂單 [ ] 萬美元(合台幣 [ ])(匯率 27.72), 預付訂金 [ ]% $[ ] 萬美 元(合台幣 [ ])(匯率 27.72)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. In accordance with the Item 15.03 clause of the contract, a [ ]% deposit of US$[ ] will be paid to BioKey according to the order amount, and the remaining [ ]% of the payment, US$[ ], will be paid by a 45-day promissory note according to the actual sales volume of each month.

依合約 [ ] 條款,依訂單金額開立 [ ]%訂金 [ ] 萬美元,剩餘 [ ]%貨款 [ ] 萬美元,依 每個月實際銷貨量開立 [ ] 天期票支付貨款。

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Our plan is [ ] million U.S. dollars for three years, [ ] in the first year, [ ] million in the second year, and [ ] million in the third year.

我們的規劃是三年 [ ] 萬美元，第一年 [ ] 萬，第二年 [ ] 萬，第三年 [ ] 萬。

## Exhibit 21.1

**Exhibit 21.1**

**BioKey (Cayman), Inc.**

**List of Subsidiaries**

---

| | |
|:---|:---|
| **Name** | **Place of Incorporation** |
| BioKey, Inc. | California |

---

## Exhibit 99.1

**Exhibit 99.1**

**Information contained herein is subject to completion or amendment. A Registration Statement on Form 10 relating to these securities has been filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended.**

**Preliminary and Subject to Completion, Dated May 27, 2026**

**INFORMATION STATEMENT**

**BioKey (Cayman), Inc.**

**Ordinary Shares**

(par value $0.0001 per share)

We are sending you this information statement in connection with the spin-off by ABVC BioPharma, Inc. ("**ABVC**") of its wholly owned subsidiary, BioKey (Cayman), Inc. (the "**Company**," "**SpinCo**," or "**BioKey Cayman**"). To effect the spin-off, ABVC will distribute approximately 10% (the "**Distribution**") of its ordinary shares, par value $0.0001 (the "**Ordinary Shares**") of BioKey Cayman on a pro rata basis to the holders of ABVC common stock (the "**ABVC Common Stock**"). You should consult your own tax advisor as to the tax consequences of the Distribution to you, including potential tax consequences under state, local, and non-U.S. tax laws.

If you are a record holder of ABVC Common Stock as of the close of business on [ ], 2026, which is the record date for the Distribution (the "**Record Date**"), for every share of ABVC Common Stock you hold, you will be entitled to receive [ ] Ordinary Shares (the "**Distribution Ratio**"). ABVC will distribute the Ordinary Shares in book-entry form, which means that we will not issue physical stock certificates. The distribution agent will not distribute any fractional shares of Ordinary Shares.

The distribution will be effective as of 11:59 p.m., New York City time, on [ ], 2026. Immediately after the Distribution becomes effective, BioKey Cayman will be an independent, public traded company, with ABVC retaining a controlling equity interest.

ABVC shareholders are not required to vote on or take any other action to approve the spin-off. We are not asking you for a proxy, and request that you do not send us a proxy. ABVC shareholders will not be required to pay any consideration for Ordinary Shares they receive in the spin-off, and they will not be required to surrender or exchange ABVC Common Stock they have or take any other action in connection with the spin-off.

No trading market for the Ordinary Shares currently exists. Following the Spin-Off, we intend to apply to have our Ordinary Shares quoted on the OTC Markets. However, there can be no assurance as to the timing of such quotation or that an active trading market will develop. Because we are not currently listed on the OTC Market, we have not yet been assigned a trading symbol. A trading symbol will be assigned in connection with, and upon completion of, the OTC listing process.

**In reviewing this information statement, you should carefully consider the matters described in the section entitled "Risk Factors" beginning on page 11 of this information statement.**

**Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or determined if this information statement is truthful or complete. Any representation to the contrary is a criminal offense.**

This information statement is not an offer to sell, or a solicitation of an offer to buy, any securities.

**The date of this information statement is May 27, 2026.**

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Industry and Market Data](#P_001) | 1 |
| [Information Statement Summary](#P_002) | 1 |
| [Questions and Answers About the Spin-Off](#P_003) | 7 |
| [Risk Factors](#P_004) | 11 |
| [Cautionary Statement Concerning Forward-Looking Statements](#P_005) | 30 |
| [The Spin-Off](#P_006) | 31 |
| [Dividend Policy](#P_007) | 41 |
| [Capitalization](#P_008) | 41 |
| [Selected Historical and Unaudited Pro Forma Condensed Consolidated Financial Data](#P_009) | 42 |
| [Unaudited Pro Forma Condensed Consolidated Financial Statements](#P_010) | 43 |
| [Business](#P_011) | 49 |
| [Management's Discussion and Analysis of Financial Condition and Results of Operations](#P_012) | 60 |
| [Management and Board of Directors](#P_013) | 68 |
| [Executive Compensation](#P_014) | 73 |
| [Security Ownership of Certain Beneficial Owners and Management](#P_015) | 77 |
| [Certain Relationships and Related Party Transactions](#P_016) | 78 |
| [Description of Our Ordinary Shares](#P_017) | 81 |
| [Where You Can Find More Information](#P_018) | 89 |
| [Index to Consolidated Financial Statements](#P_019) | F-1 |

---

i

**INDUSTRY AND MARKET DATA**

This information statement includes estimates regarding market and industry data and forecasts, which are based on publicly available information, industry publications and surveys, reports from government agencies, reports by market research firms, and our own estimates based on our management's knowledge of, and experience in, the markets in which we compete. This information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process, and other limitations and uncertainties inherent in surveys of market size. Furthermore, all of this information involves a variety of assumptions, limitations, and methodologies and is inherently subject to uncertainties, and therefore you are cautioned not to give undue weight to these estimates.

**INFORMATION STATEMENT SUMMARY**

In this information statement, unless the context otherwise requires:

● "Company," "BioKey Cayman," "SpinCo," "we," "our," "ourselves," and "us" refer to BioKey (Cayman), Inc. and its consolidated subsidiaries after giving effect to the spin-off;

● "EIT" refers to enterprise income tax;

● "ABVC" or "Parent" refers to ABVC BioPharma, Inc., a Nevada corporation, and all of its subsidiaries as defined herein unless the context specifies;

● "PCAOB" refers to Public Company Accounting Oversight Board;

● "SEC" refers to the U.S. Securities and Exchange Commission;

● "Share Distribution" refers to ABVC's distribution to its shareholders of 10% of the Ordinary Shares ABVC owns;

● "Share Distribution Date" refers to the date on which the Share Distribution occurs;

● "Spin-Off" refers to the Share Distribution and related transactions pursuant to which we will be separated from ABVC;

● "U.S." refers to United States of America;

● "$," "USD," "US$," or "U.S. dollars" are to the legal currency of the United States.

Unless the context otherwise requires, or when otherwise specified, references in this information statement to our historical assets, liabilities, products, businesses, or activities of our businesses are generally intended to refer to the historical assets, liabilities, products, businesses, or activities of BioKey Cayman businesses as they were conducted as part of ABVC prior to completion of the Spin-Off.

**Corporate Structure**

ABVC was incorporated under the laws of the State of Nevada on February 6, 2002, and has four wholly owned Subsidiaries: American BriVision Corporation, a Delaware corporation, BioLite Holding, Inc., a Nevada corporation, the Company and BioKey, Inc., a California corporation ("**BK California**"). ABVC is a clinical stage biopharmaceutical company focused on development of new drugs and medical devices, all of which are derived from plants.

BK California was incorporated in California on November 20, 2020, and is a wholly owned subsidiary of ABVC. BK California's mission is to capitalize on the growth opportunities in the generic drug market. Currently, BK California is a pharmaceutical manufacturing and development company.

The Company is a holding company that was incorporated under the laws of the Cayman Islands on June 14, 2023, and is a wholly owned subsidiary of ABVC.

On February 8, 2019, ABVC acquired BK California through a stock-for-stock transaction, whereby ABVC issued 30,000,000 shares of its Common Stock, valued at $2 per share, to BK California's shareholders. As a result, BK California became a wholly owned subsidiary of ABVC. The acquisition was disclosed in the Form S-4 registration statement (File Number 333-226285) filed with the SEC.

Prior to the 2025 Reorganization (as defined below), ABVC owned 7,418,134 shares of common stock, 7,000,000 shares of Series A preferred stock, 1,160,000 shares of Series B preferred stock, and 13,973,097 shares of Series C preferred stock, equating to 100% of the issued and outstanding stock of BK California, with a par value of US$0.001 per share (the "**BK California Stock**"). On May 10, 2025, the Company entered into a Share Transfer Agreement ("**STA**") with ABVC and BK California, pursuant to which the Company acquired 100% of the equity interests of BK California from ABVC in exchange for $100 (the "**2025 Reorganization**"). The transaction documents contain customary representations, warranties, and covenants, and the notes include customary events of default including, but not limited to, organization and good standing, title to the subject shares, non-contravention, and no litigation. The Company is also obligated to register for resale the shares issuable upon conversion of the notes.

Following the 2025 Reorganization where BK California became a wholly owned subsidiary of BioKey Cayman, the Company was restructured into a fully integrated Contract Research Organization ("**CRO**") and Contract Development and Marketing Organization ("**CDMO**") platform, offering both research and manufacturing services under one roof.

BioKey Cayman has no operations, subsidiaries, or variable-interest entities in the People's Republic of China or Hong Kong.

**The Spin-Off**

On May [ ], 2026, BioKey Cayman announced plans for the partial legal and structural separation of our business from ABVC**.** In reaching the decision to pursue the Spin-Off, ABVC considered a range of potential structural alternatives for the business and concluded that the Spin-Off is the most attractive alternative for enhancing shareholder value.

To affect the Spin-Off, first, BioKey Cayman will establish an independent board of directors and name executive officers. ABVC will subsequently distribute the Ordinary Shares to ABVC shareholders via the Share Distribution, after which, BioKey Cayman, holding the business, will become an independent company.

Prior to the completion of the Spin-Off, we intend to enter into a Separation and Distribution Agreement with ABVC related to the Spin-Off. The Separation and Distribution Agreement will govern the relationship between ABVC and SpinCo up to and after completion of the Spin-Off and allocate between ABVC and SpinCo various assets, rights, liabilities, and obligations, including employee benefits, intellectual property, environmental and tax-related assets, and liabilities. See "*Certain Relationships and Related Party Transactions*" and "*Selected Historical and Unaudited Pro Forma Condensed Consolidated Financial Data*," for more information.

Completion of the Spin-Off is subject to the satisfaction or waiver of specified conditions. In addition, ABVC has the right not to complete the Spin-Off if, at any time, ABVCs board of directors (the "**ABVC Board**") determines, in its sole and absolute discretion, that the Spin-Off is not in the best interests of ABVC or its shareholders or is otherwise not advisable. See "*The Spin-Off—Conditions to the Spin-Off*" for more information.

Following the Spin-Off, SpinCo, and ABVC will each have a more focused business and be better positioned to invest in growth opportunities through tailored capital allocation and will be better able to execute each company's specific strategic plans. SpinCo, through its subsidiaries, operates as a fully integrated CRO/CDMO platform, offering both research and manufacturing services under one roof. SpinCo will work to maximize value for its investors, while being able to scale its operations to meet the growth of the markets it serves. Further, the Spin-Off will allow our management team to devote its time and attention to corporate strategies and policies that are based specifically on the needs of our business and its dynamic end markets. We plan to create incentives for our management and employees that are more closely tied to business performance and our shareholders' expectations, which we believe will help us attract and retain highly qualified personnel. Additionally, we believe the Spin-Off will help align our shareholder base with the characteristics and risk profile of our business. See "*The Spin-Off—Reasons for the Spin-Off*" for more information.

Aspects of the Spin-Off may increase the risks associated with ownership of Ordinary Shares. In connection with the Spin-Off, we may enter into a revolving credit facility to be available for our working capital and other cash needs in the future as needed. See "*Capitalization*" and "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" for more information. Furthermore, as an independent entity we may lose some of the benefits of purchasing power, borrowing leverage, and available capital for investments associated with being a larger entity. See "*Risk Factors*" in this information statement. Because of the foregoing, there is no guarantee that any dividends will be declared on our Ordinary Shares by our board of directors (our "**Board**"), or if so declared, will be continued in the future. For more information, see "*Dividend Policy*."

Following the Spin-Off, we expect our Ordinary Shares to be traded over-the-counter on the OTC Markets under the ticker symbol assigned to us in connection with, and upon completion of, the OTC listing process .

**Business Overview**

BioKey (Cayman), Inc. ("**BioKey**") is a nutraceutical and functional-supplement research, development, and manufacturing company operating under a vertically integrated model. BioKey focuses on the development of proprietary botanical-based formulations that include Maitake extract, β-glucan, and Radix Polygala (PDC-1421) and provides contract research, pilot-scale formulation, GMP manufacturing, regulatory documentation support, and commercial supply services to partners across Asia and North America. BioKey's activities span early-stage ingredient innovation, formulation optimization, analytical method establishment, stability testing, clinical batch manufacturing, and commercial-ready packaging. The Company also develops its own proprietary nutraceutical products for future market distribution. BioKey's customers include dietary supplement companies, functional food brands, wellness distributors, and research institutions seeking specialized botanical formulations. The Company leverages its scientific team, manufacturing expertise, and growing network of strategic partners to expand into high-growth health categories, including sleep, mood, immune support, metabolic wellness, and clinical nutrition.

Over the years, in conjunction with our subsidiaries, we have successfully obtained four Abbreviated New Drug Application ("**ANDA**") approvals from the U.S. Food and Drug Administration ("**FDA**"), including:

● BK101 Benazepril Hydrochloride Tablets (5, 10, 20, and 40 mg), ANDA 076-820, approved on February 3, 2006;

● BK123 Levetiracetam 500 mg Tablets, ANDA 090-906, approved on November 5, 2010;

● BK119 Cilostazol 50 mg, ANDA 077-722, and 100 mg Tablets, ANDA 077-831, both approved on September 24, 2012.

The Company's capabilities include:

● Contract Research Services (CRO) for preclinical and clinical trials, including protocol design, data management, statistical analysis, and regulatory strategy;

● Active Pharmaceutical Ingredient (API) analysis and characterization;

● Drug formulation and analytical method development;

● Clinical trial material production under cGMP conditions; and

● FDA-compliant documentation and regulatory filing support.

The Company's principal operations are conducted through its Fremont, California facility, which houses its cGMP-certified manufacturing site, formulation development labs, and newly added CRO capabilities.

In 2022, BK California began manufacturing a dietary supplement based on the maitake mushroom. The mushrooms, supplied by Shogun Maitake Canada, Co. Ltd., are grown in a controlled temperature and humid environment free of pesticides and chemicals. Initially, BK California will target sales of the new supplement to high-end grocery stores globally via online distribution, with a focus on the U.S. and Canada markets. While many mushroom-based supplements are currently available to customers, BK California believes that their new line has a significant competitive advantage since to their knowledge, the purity and consistency of the mushrooms themselves exceeds any maitake mushrooms currently available; additionally, the extraction process BK California employs delivers a particularly strong dose. The maitake mushroom is rich in bioactive polysaccharides, especially beta-glucans. These polysaccharides have well-documented immune-protecting and antitumor properties. <sup>12</sup> BK California has developed both a tablet and a liquid version of the supplement. GMP manufacturing of bulk quantities of Maitake mushroom tablets and Maitake mushroom drinks was completed in 2 and 1 batches, respectively, for commercial launches in Taiwan and Canada in 2022. The initial Maitake product launches were conducted on a limited, pilot-scale basis in select markets to validate manufacturing processes, regulatory readiness, and supply chain logistics. While these launches did not generate material revenue, they provided operational validation and informed subsequent product positioning and commercialization planning.

Beta-glucans in maitake mushrooms have been shown to reduce cholesterol, resulting in improved artery functionality and overall better cardiovascular health, lowering the risk of heart disease. Further, studies have shown that the beta-glucans in maitake mushrooms strengthen the immune system. <sup>34</sup> In a trial of postmenopausal breast cancer patients, oral administration of a maitake extract was shown to have immunomodulatory effects. <sup>56</sup> In a different Memorial Sloan Kettering Cancer Center trial, maitake extracts enhanced neutrophil and monocyte function in patients with myelodysplastic syndrome. It boosts the production of lymphokines (protein mediators) and interleukins (secreted proteins), improving immune response. Further, third party clinical trials have shown beta-glucans to lower blood glucose levels, helping to activate insulin receptors while reducing insulin resistance in diabetes management <sup>7</sup>.

BK California has entered into a Supply and Distribution Agreement with Define Biotech Co. Ltd., a company organized and existing under the Laws of Taiwan ("**Define Biotech**" and the "**Define Biotech Agreement**", respectively). Define Biotech is a Taiwan-based pharmaceutical marketing company focusing on selling pharmaceuticals, dietary supplements, and medical products in the Asia-Pacific region. The Define Biotech Agreement appoints Define Biotech as the exclusive distributor of certain BK California's Maitake-based products in Taiwan and mainland China, with an exclusive trademark license for marketing and sales in the territory. Define Biotech must procure all product requirements solely from BK California, adhere to minimum purchase quantities, and provide rolling forecasts, while BK California must supply cGMP-compliant products accompanied by Certificates of Analysis and Compliance. Pricing is based on BK California's manufacturing costs, with a 10% deposit and balance paid via promissory notes. Define Biotech is responsible for regulatory approvals and monthly sales reporting, with recall and indemnity responsibilities shared between the parties depending on fault. The Define Biotech Agreement has a five-year initial term with automatic two-year renewals and is governed by Singapore law. The Define Biotech Agreement may terminate automatically upon: (i) either party providing 180 days' written notice with the written consent of the other party; (ii) unenforceability due to force majeure; (iii) termination pursuant to other termination provisions of the Agreement; or (iv) termination of the related Licensing Agreement dated December 6, 2021. Additionally, either party may terminate the Define Biotech Agreement immediately by written notice if the other party fails to pay amounts due for two months or more, commits a material breach that is not cured within the applicable notice and cure periods, becomes insolvent, has a receiver or administrator appointed, enters into a composition with creditors, or enters liquidation (other than for restructuring or amalgamation). Upon termination, the terminating party may elect to require that all purchase orders issued prior to termination be completed and paid in accordance with the Define Biotech Agreement. Except for accrued rights and obligations, all rights and liabilities under the Define Biotech Agreement terminate upon cancellation or termination unless otherwise expressly provided.

<sup>1</sup> https://pubmed.ncbi.nlm.nih.gov/29723488/

<sup>2</sup> https://pmc.ncbi.nlm.nih.gov/articles/PMC3751581/?utm_source=chatgpt.com

<sup>3</sup> https://doi.org/10.3177/jnsv.43.13

<sup>4</sup> https://doi.org/10.1016/0271-5317(96)00014-3

<sup>5</sup> https://pubmed.ncbi.nlm.nih.gov/19253021/

<sup>6</sup> https://www.mskcc.org/cancer-care/integrative-medicine/herbs/maitake?utm_source=chatgpt.com

<sup>7</sup> https://pmc.ncbi.nlm.nih.gov/articles/PMC4317517

**Our Strengths**

The following is a summary of our competitive strengths:

● **Favorable Market Trends in Nutraceuticals and Functional Supplements:** the Company is positioned in a global nutraceuticals market projected to grow from ~$112B in 2022 to ~$167B by 2030, driven by consumer demand for immune health, metabolic wellness, and chronic disease prevention products. <sup>89</sup>

● **Integrated Research and Marketing Platform:** the Company's end-to-end CRDMO capabilities, from early-stage formulation and analytical testing to full-scale cGMP manufacturing, is set up to deliver higher efficiency & faster timelines than other similar companies, while ensuring regulatory compliance.

● **Proprietary Ingredient Technologies and Product Development:** our expertise in botanical extracts such as Maitake and Polygala, enable us to produce differentiated products with potentially strong clinical validation and intellectual property protection opportunities.

● **Strategic Partnerships and Service Network:** we have active, non-exclusive working relationships with regional distributors, manufacturing service providers, and scientific advisors in Asia, as well as preliminary business development activities in North America. These relationships support our ability to source raw materials, coordinate contract manufacturing, and explore market entry opportunities for select nutraceutical and functional supplement products.

● **Experienced Management Team with Cross-Border Track Records:** our leadership team has been successful in the biotech, nutraceuticals, and pharmaceutical development industries, and we believe we can leverage their U.S. and Asia experience to accelerate commercialization and growth.

**Corporate Information**

We are a Cayman Islands company formed on June 14, 2023. Our principal executive offices are located at 44370 Old Warm Springs Blvd., Fremont, CA 94538 USA. Our telephone number is (845) 291-1291. Our website address is https://biokeyinc.com/. Information contained on, or connected to, our website or ABVCs website does not and will not constitute part of this information statement or the registration statement on Form 10 of which this information statement is a part. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website.

**Summary of Risk Factors**

You should carefully consider all of the information in this information statement and each of the risks described in this information statement, which we believe are the principal risks that we face, including but not limited to:

***Risks Related to Our Business and Industry***

For more detailed discussions of the following risks, see "*Risk Factors—Risks Related to our Business and Industry*" on pages 11 through 25.

● Our subsidiaries' business operations are cash intensive, and our subsidiaries' business could be adversely affected if we fail to maintain sufficient levels of liquidity and working capital;

● We grant relatively long payment terms for accounts receivable which can adversely affect our cash flow;

<sup>8</sup> https://www.grandviewresearch.com/industry-analysis/nutraceuticals-market <br> <sup>9</sup> https://www.alliedmarketresearch.com/nutraceuticals-market?utm_source=chatgpt.com

● Our subsidiaries face short lead-times for delivery of products to customers. Failure to meet delivery deadlines could result in the loss of customers and damage to our reputation and goodwill;

● Our subsidiaries face intense competition, and if we are unable to compete effectively, we may not be able to maintain profitability;

● Our revenues are highly dependent on a limited number of customers and the loss of any one of our subsidiaries' major customers could materially and adversely affect our growth and revenues;

● As our subsidiaries expand their operations, they may need to establish a more diverse supplier network for raw materials. The failure to secure a more diverse supplier network could have an adverse effect on our financial condition;

● New lines of business may subject us and our subsidiaries to additional risks;

● We are subject to various risks and uncertainties that may affect our subsidiaries' ability to procure raw materials.

***Risks Related to Our Ordinary Shares and the Securities Market***

For more detailed discussions of the following risks, see "*Risk Factors—Risks Related to Our Ordinary Shares*" on pages 25 through 27.

● No market for our shares of Ordinary Shares currently exists, and an active trading market may not develop or be sustained after the Spin-Off. Following the Spin-Off, the price of our Ordinary Shares may fluctuate significantly;

● Substantial sales of our Ordinary Shares may occur in connection with the Spin-Off, which could cause our stock price to decline;

● Since we do not expect to pay dividends in the foreseeable future, you must rely on the price appreciation of our shares of Ordinary Shares for a return on your investment;

● Your percentage ownership in the Company may be diluted in the future;

● The rights associated with the Ordinary Shares may differ from the rights associated with ABVCs Common Stock; and

● If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired and investors' views of us could be harmed.

***Risks Related to the Spin-Off***

For more detailed discussions of the following risks, see "*Risk Factors—Risks Related to the Spin-Off*" on pages 28 through 30.

● If the Spin-Off does not qualify for its intended U.S. tax treatment, ABVC and its shareholders could incur significant costs;

● Until the Spin-Off occurs, ABVC has sole discretion to change the terms of the Spin-Off in ways that may be unfavorable to us;

● We may be unable to achieve some or all of the benefits that we expect to achieve from the Spin-Off;

● We may be unable to make, on a timely or cost-effective basis, the changes necessary to operate as an independent company, and we may experience increased costs after the Spin-Off;

● We may incur new indebtedness post the Share Distribution, and the degree to which we will be leveraged following completion of the Share Distribution could adversely affect our business, financial condition, and results of operations;

● Our customers, prospective customers, suppliers, or other companies with whom we conduct business may need assurances that our financial stability on a stand-alone basis is sufficient to satisfy their requirements for doing or continuing to do business with them;

● We may have potential business conflicts of interest with ABVC with respect to our past and ongoing relationships; and

● We may not be able to resolve any potential conflicts, and, even if we do so, the resolution may be less favorable to us than if we were dealing with an unaffiliated party.

**Reasons for Furnishing This Information Statement**

We are furnishing this information statement solely to provide information to ABVC shareholders who will receive our Ordinary Shares in the Share Distribution. ABVC shareholders are not required to vote on the Share Distribution. Therefore, you are not being asked for a proxy, and you are not required to send a proxy to ABVC. You do not need to pay any consideration, exchange, or surrender your existing ABVC Common Stock or take any other action to receive your ABVC Common Stock. You should not construe this information statement as an inducement or encouragement to buy, hold or sell any of our securities or any securities of BioKey Cayman. We believe that the information contained in this information statement is accurate as of the date set forth on the cover. Changes to the information contained in this information statement may occur after that date, and neither we nor ABVC undertakes any obligation to update the information except in the normal course of our and ABVCs respective public disclosure obligations and practices.

**QUESTIONS AND ANSWERS ABOUT THE SPIN-OFF**

The following provides only a summary of certain information regarding the Spin-Off. You should read this information statement in its entirety for a more detailed description of the matters described below.

***Q: What is the Spin-Off?***

A: The Spin-Off is the method by which we will separate from ABVC. In the Spin-Off, ABVC will distribute to its shareholders [ ]% of its Ordinary Shares. Following the Spin-Off, we will be an independent company, and it is anticipated that ABVC will retain a [ ]% ownership interest in our Company. You do not have to pay any consideration or give up any portion of your ABVC Common Stock to receive our Ordinary Shares in the Spin-Off.

***Q: What are the reasons for the Spin-Off?***

A: The ABVC Board believes that the Spin-Off of the BioKey Cayman division from ABVC is in the best interests of ABVC shareholders and for the success of the business for a number of reasons. Primarily, ABVC and SpinCo will each have a more focused business, able to attract team members and be better able to dedicate financial, management, and other resources to leverage their respective areas of strength and differentiation once the Spin-Off occurs. Dr. T.S. Jiang, Eugene Jiang, and Uttam Patil, all of whom will be either an ABVC director or executive officer, will serve on the Company's board or be an executive officer. Each will allocate their time and responsibilities using their best business judgement and in dialogue with the separate board of directors for each company. The boards of directors of ABVC and the Company will owe fiduciary duties to their respective shareholder bases, with the ABVC Board focusing on matters specific to ABVC, and the Board focusing on matters specific to the Company. See "*The Spin-Off—Reasons for the Spin-Off*" for more information.

***Q: Is the completion of the Spin-Off subject to the satisfaction or waiver of any conditions?***

A: Yes, the completion of the Spin-Off is subject to the satisfaction, or ABVC Board's waiver, of certain conditions. Any of these conditions may be waived by ABVCs Board to the extent such waiver is permitted by law. In addition, ABVC may at any time until the Share Distribution decide to abandon the Share Distribution or modify or change the terms of the Share Distribution. See "*The Spin-Off—Conditions to the Spin-Off*" for more information.

***Q: Will the number of ABVC shares I own change as a result of the Spin-Off?***

A: No, the number of shares of ABVC Common Stock you own will not change as a result of the Spin-Off.

***Q: Will the Spin-Off affect the trading price of my ABVC Common Stock?***

A: We expect the trading price of ABVC Common Stock immediately following the Share Distribution to be lower than the trading price immediately prior to the Share Distribution because the trading price will no longer reflect the value of SpinCo. There can be no assurance that, following the Share Distribution, the combined trading prices of the ABVC Common Stock and our Ordinary Shares will equal or exceed what the trading price of ABVC Common Stock would have been in the absence of the Spin-Off.

It is possible that after the Spin-Off, the combined equity value of ABVC and SpinCo will be less than ABVCs equity value before the Spin-Off. We cannot guarantee any change in the share prices of either entity following the Spin-Off.

***Q: What will I receive in the Spin-Off in respect of my ABVC Common Stock?***

A: As a holder of ABVC Common Stock, you will receive a distribution of [ ] Ordinary Shares for every share of ABVC Common Stock you hold on the Record Date (as defined below). The distribution agent will distribute only whole shares of our Ordinary Shares in the Spin-Off. See "*The Spin-Off—Treatment of Fractional Shares*" for more information on the treatment of the fractional share you may be entitled to receive in the Share Distribution. Your proportionate interest in ABVC will not change as a result of the Spin-Off. For a more detailed description, see "*The Spin-Off*."

***Q: What is being distributed in the Spin-Off?***

A: ABVC will distribute [ ]% of the Ordinary Shares that it owns, based on the [ ] shares of ABVC Common Stock outstanding as of May [ ], 2026. The actual number of our Ordinary Shares that ABVC will distribute will depend on the total number of shares of ABVC Common Stock outstanding on the Record Date. Since ABVC owns all of our Ordinary Shares, the distribution will constitute 10% of our issued and outstanding Ordinary Shares immediately prior to the Share Distribution and ABVC's current shareholders will be our only shareholders after the Share Distribution. For more information on the shares being distributed in the Spin-Off, see "*Description of Our Capital Stock.*"

***Q: What is the record date for the Share Distribution?***

A: ABVC will determine record ownership as of the close of business on [ ], 2026, which we refer to as the "**Record Date**."

***Q: When and how will the Share Distribution occur?***

A: The Share Distribution will be effective as of 11:59 p.m., New York City time, on [ ], 2026, which we refer to as the "**Share Distribution Date**." On the Share Distribution Date, ABVC will release the Ordinary Shares it owns to the distribution agent to distribute to ABVC shareholders via book entry.

***Q: What do I have to do to participate in the Share Distribution?***

A: You are not required to take any action to participate, but we urge you to read this information statement carefully. All holders of ABVC Common Stock as of the Record Date will be deemed to participate in the Share Distribution. Holders of ABVC Common Stock on the Record Date will not need to pay any cash or deliver any other consideration, including any ABVC Common Stock, to receive our Ordinary Shares in the Share Distribution. In addition, no shareholder approval of the Share Distribution is required. We are not asking you for a vote and request that you do not send us a proxy card.

***Q: If I sell my ABVC Common Stock on or before the Share Distribution Date, will I still be entitled to receive SpinCo Ordinary Shares in the Share Distribution?***

A: If you sell your shares of ABVC Common Stock before the Record Date, you will not be entitled to receive SpinCo Ordinary Shares in the Share Distribution. If you hold ABVC Common Stock on the Record Date and you decide to sell them on or before the Share Distribution Date, you may have the ability to choose to sell your shares of ABVC Common Stock with or without your entitlement to receive our Ordinary Shares in the Share Distribution. You should discuss the available options in this regard with your bank, broker, or other nominee. See "*The Spin-Off—Trading Prior to the Share Distribution Date*" for more information.

***Q: How will fractional shares be treated in the Share Distribution?***

A: The distribution agent will not distribute any fractional shares of our Ordinary Shares in connection with the Spin-Off. Instead, the distribution agent will round up any fractional shares to the next whole number of shares at the time of the distribution of shares of the Spin-Off. See *"The Spin-Off—Treatment of Fractional Shares*" for a more detailed explanation of the treatment of fractional shares.

***Q: What are the U.S. federal income tax consequences to me of the Share Distribution?***

A: The Spin-Off will be a taxable distribution for U.S. federal income tax purposes. Accordingly, each holder of ABVC Common Stock that is a U.S. holder (as defined in "*Material U.S. Federal Income Tax Consequences of the Spin-Off*") would generally be treated as receiving a taxable distribution equal to the fair market value of our Ordinary Shares (determined at the time of the Spin-Off). Such distribution would be treated as a taxable dividend to the extent of such holder of ABVC Common Stocks ratable share of ABVCs current or accumulated earnings and profits (as determined for U.S. federal income tax purposes). To the extent the value of the distribution exceeds the amount of such earnings and profits, such excess will be treated first, as reducing such holder of ABVC Common Stocks adjusted basis in each share of its ABVC Common Stock, in respect of which such distribution was made, and second, to the extent it exceeds such adjusted basis, as capital gain from the sale or exchange of such share of ABVC Common Stock, as the case may. For more information regarding the potential U.S. federal income tax consequences to you as a result of the distribution of shares of ABVC Common Stock in the Spin-Off, see the section entitled "*Material U.S. Federal Income Tax Consequences of the Spin-Off*".

***Q: Does SpinCo intend to pay cash dividends?***

A: Subject to the sole discretion of our Board and the considerations discussed below, once the Spin-Off is effective, we do not anticipate paying cash dividends on our Ordinary Shares for the foreseeable future. Among the items we will consider when establishing a dividend policy will be the capital needs of our business and opportunities to retain future earnings for use in the operation of our business and to fund future growth. There is no guarantee that any dividends will be declared by our Board, or if so declared, will be continued in the future. See "*Dividend Policy*" for more information.

***Q: Will SpinCo incur any debt prior to or at the time of the Share Distribution?***

A: SpinCo will not incur any additional debt as a result of the Share Distribution. Post the Spin-Off, we may incur indebtedness from time to time in the ordinary course of our business. If needed, we may also enter into a revolving credit facility to be available for our working capital and other cash needs. The terms of such indebtedness are subject to change and will be finalized prior to the closing of the Spin-Off. See "*Capitalization*" and "*Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources*" for more information.

***Q: How will our Ordinary Shares trade?***

A: Following the Spin-Off, we intend to apply to have our Ordinary Shares quoted on the OTC Markets under the symbol assigned to us in connection with, and upon completion of, the OTC listing process. Currently, there is no public market for our Ordinary Shares. We cannot guarantee that our Ordinary Shares will be quoted on the OTC Markets and cannot predict the trading prices for our Ordinary Shares before, on, or after the Share Distribution Date. No public trading market for our Ordinary Shares is expected to exist at the time of the Share Distribution, and trading will not commence until, and unless, our Ordinary Shares are quoted on the OTC Markets following the Spin-Off. There can be no assurance as to the timing of such quotation or that an active trading market will develop. See "*The Spin-Off—Trading* of our Ordinary Shares" for more information.

***Q: Do I have appraisal rights in connection with the Spin-Off?***

A: No. Holders of ABVC Common Stock are not entitled to appraisal rights in connection with the Spin-Off.

***Q: Who is the transfer agent and registrar for SpinCo Ordinary Shares?***

A: VStock Transfer, LLC is the transfer agent and registrar for SpinCo Ordinary Shares.

***Q: Are there risks associated with owning SpinCo Ordinary Shares?***

A: Yes, there are substantial risks associated with owning SpinCo Ordinary Shares. Accordingly, you should read carefully the information set forth under "*Risk Factors*" in this information statement.

***Q: Where can I get more information?***

A: If you have any questions relating to the mechanics of the Share Distribution, you should contact the distribution agent at VStock Transfer, LLC. Before the Spin-Off, if you have any questions relating to the Spin-Off, you should contact ABVC at info@abvcpharma.com, or the Company at info@biokeyinc.com.

After the Spin-Off, if you have any questions relating to SpinCo, you should contact us at info@biokeyinc.com.

**RISK FACTORS**

You should carefully consider all of the information in this information statement and each of the risks described below, which we believe are the principal risks that we face. Some of the risks relate to our business, others to the Spin-Off. Some risks relate principally to the securities markets and ownership of our Ordinary Shares.

Any of the following risks, as well as other risks not currently known to us or that we currently consider immaterial, could materially and adversely affect our business, financial condition, results of operations, cash flows, and the actual outcome of matters as to which forward-looking statements are made in this information statement.

The following risk factors are not necessarily presented in order of relative importance and should not be considered to represent a complete set of all potential risks that could affect us.

**Risks Related to Our Business and Industry**

***The Company is a development stage biopharmaceutical company and is thus subject to the risks associated with new businesses in that industry.***

The Company is a clinical stage biopharmaceutical company with operations that generate unsubstantial revenues. The Company is establishing and implementing many important functions necessary to operate a business, including the clinical research and development of our products, further establishment of the Company's managerial and administrative structure, accounting systems and internal financial controls.

BioKey Cayman is expected to continue to have limited revenue and remain unprofitable for an indefinite period of time.

Accordingly, you should consider the Company's prospects in light of the risks and uncertainties that a pharmaceutical company with a limited operating history and revenue faces. In particular, potential investors should consider that there are significant risks that the Company will not be able to:

● implement or execute its current business plan, or generate profits;

● attract and maintain a skillful management team;

● raise sufficient funds in the capital markets or otherwise to effectuate its business plan;

● determine that the processes and technologies that it has developed are commercially viable; and/or

● enter into contracts with commercial partners, such as licensors and suppliers.

If any of the above risks occurs, the Company's business may fail, in which case you may lose the entire amount of your investment in the Company. The Company cannot assure that any of its efforts in business operations will be successful or result in the timely development of new products, or ultimately produce any material revenue and profits.

As a pre-profit biopharmaceutical company, the Company needs to transition from a company with a research and development focus to a company capable of supporting commercial activities. The Company may not be able to reach such transition point or make such a transition, which would impact our business, financial condition, results of operations and prospects.

 ****

***If the Company fails to raise additional capital, its ability to implement its business model and strategy could be compromised.***

The Company has limited capital resources and operations. The CDMO services provided by BioKey Cayman generate a limited amount of revenue that can only partially support the operations of the Company. From time to time, we may seek additional financing to provide the capital required to expand research and development ("**R&D**") initiatives and/or working capital, as well as to repay outstanding loans if cash flow from operations is insufficient to do so. We cannot predict with certainty the timing or amount of any such capital requirements.

If the Company does not raise sufficient capital to fund its ongoing development activities, it is likely that it will be unable to carry out its business plans, including R&D development and expansion of production facilities. Currently, the Company has had to put several projects on hold due to a lack of funding. Even if the Company obtains financing for near-term operations and product development, the Company may require additional capital beyond the near term. Furthermore, additional capital may not be available in sufficient amounts or on reasonable terms, if at all, and our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to and volatility in the credit and financial markets in the United States and worldwide. If the Company is unable to raise capital when needed, its business, financial condition and results of operations would be materially adversely affected, and it could be forced to reduce or discontinue our operations.

 ****

***The Company has no history of obtaining regulatory approval for, or commercializing, any new drug candidate.***

With limited operating history, the Company has never obtained regulatory approval for, or commercialized, any new drug candidate. It is possible that the FDA may refuse to accept any planned New Drug Applications (or "**NDAs**") for any drug products for substantive review or may conclude after review of our data that our applications are insufficient to obtain regulatory approval of the new drug candidates. Although our CDMO strategic business department has experience in obtaining abbreviated new drug application (or "**ANDA**") approvals, the processes, and timelines of obtaining an NDA approval and ANDA approval can differentiate substantially. If the FDA does not accept or approve an NDA for our product candidates, it may require that we conduct additional clinical, preclinical, or manufacturing validation studies, which may be costly. Depending on the FDA required studies, approval of any NDA or application that we submit may be significantly delayed, possibly for several years, or may require us to expend more resources than we have. Any delay in obtaining, or inability to obtain, regulatory approvals of any of our drug candidates will prevent us from sublicensing such product. It is also possible that additional studies, if performed and completed, may not be considered sufficient by the FDA. If any of these outcomes occur, we may be forced to abandon our planned NDA for such drug candidate, which materially adversely affects our business and could potentially cause us to cease operations. We face similar regulatory risks in a foreign jurisdiction.

***Our growth is dependent on our ability to successfully develop, acquire or license new drugs.***

Our growth is supported by continuous investment in time, resources, and capital to identify and develop new products or new formulations for the market and market penetration. If we are unable to either develop new products on our own or acquire licenses for new products from other parties, our ability to increase revenues and market share will be adversely affected. In addition, we may not be able to recover our investment in the development of new drugs and medical devices, given that projects may be interrupted, unsuccessful, not as profitable as initially contemplated or we may not be able to obtain necessary financing for such development. Similarly, there is no assurance that we can successfully secure such rights from third parties on an economically feasible basis.

***The facilities where the samples of drug candidates are manufactured need to be maintained and monitored in compliance with the good manufacturing practice standards, the failure of such maintenance could contaminate the results of our clinical trials and adversely affect our operations.***

BioKey Cayman operates a laboratory facility that is a certified good manufacturing practice facility ("**cGMP**") and some of its contract clinical trial service providers use cGMP facilities to conduct clinical studies. We cannot be certain that our present or future contract manufacturers or suppliers will be able to comply with cGMPs regulations and other FDA regulatory requirements. Failure to comply with these requirements may result in, among other things, total or partial suspension of production activities, failure of the FDA to grant approval for marketing, and withdrawal, suspension, or revocation of marketing approvals.

***Developments in patent law could have a negative impact on the Company's Licensors' patent positions and the Company's business.***

From time to time, the U.S. Supreme Court, other federal courts, the U.S. Congress or the USPTO may change the standards of patentability, and any such changes could have a negative impact on the Company's business.

In addition, the Leahy-Smith America Invents Act, or the America Invents Act, which was signed into law in 2011, includes a number of significant changes to U.S. patent law. These changes include a transition from a "first-to-invent" system to a "first-to-file" system, changes the way issued patents are challenged, and changes the way patent applications are disputed during the examination process. These changes may favor larger and more established companies that have greater resources to devote to patent application filing and prosecution. The USPTO has developed regulations and procedures to govern the full implementation of the America Invents Act, and many of the substantive changes to patent law associated with the America Invents Act, and, in particular, the first-to-file provisions, became effective on March 16, 2013. Substantive changes to patent law associated with the America Invents Act may affect the Company's ability to obtain patents, and if obtained, to enforce or defend them. Accordingly, it is not clear what, if any, impact the America Invents Act will ultimately have on the cost of prosecuting the Company's patent applications, its ability to obtain patents based on its discoveries and its ability to enforce or defend its patents.

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***Our current products have certain side effects. If the side effects associated with our current or future products are not identified prior to their marketing and sales, we may be required to withdraw such products from the market, perform lengthy additional clinical trials or change the labeling of our products, any of which could adversely impact our growth.***

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We develop and commercialize nutraceutical and functional supplement products derived from botanical and mushroom-based ingredients, including Maitake (Grifola frondosa) extract and other bioactive compounds. Although these products are marketed as dietary supplements rather than prescription drugs, the ingredients used in such formulations may still cause adverse reactions in certain individuals. For example, Maitake mushroom extract and its β-glucan components have been associated in published literature with gastrointestinal discomfort (such as bloating or diarrhea), allergic reactions, changes in blood glucose levels, and interactions with antidiabetic or antihypertensive medications. Individuals who are pregnant, immunocompromised, or taking chronic medications may be at increased risk of adverse effects. As with many botanical supplements, long-term safety data in humans may be limited, and additional side effects or interactions could be identified as the Company expands distribution, and more consumers use its products. Any unexpected adverse events, negative consumer reports, or safety concerns could impact product acceptance, lead to regulatory scrutiny, or result in product reformulation or withdrawal.

The occurrence of any of those adverse events would harm our future sales of these products and substantially increase the costs and expenses of marketing these medicines, which in turn could cause our revenues and net income to decline. In addition, the reputation and sales of our future medicines could be adversely affected due to the severe side effects discovered.

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***We may be subject to product liability claims in the future, which could divert our resources, cause us to incur substantial liabilities and limit commercialization of any products that we may develop.***

We face an inherent business risk of exposure to product liability claims in the event that the use of our products are alleged to have caused adverse side effects. Side effects or marketing or manufacturing problems pertaining to any of our products could result in product liability claims or adverse publicity. These risks will exist for those products in clinical development and with respect to those products that receive regulatory approval for commercial sale. Furthermore, although we have not historically experienced any problems associated with claims by users of our products, we do not currently maintain product liability insurance and there could be no assurance that we are able to acquire product liability insurance with terms that are commercially feasible.

We face an inherent risk of product liability claims as a result of the clinical testing of our products and potentially commercially selling any products that we may develop. For example, we may be sued if any product we develop allegedly causes injury or is found to be otherwise unsuitable during clinical testing, manufacturing, marketing, or sale. Any such product liability claim may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence, strict liability, or a breach of warranties. Claims could also be asserted under state consumer protection acts. If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of our product candidate. Regardless of the merits or eventual outcome, liability claims may result in:

● decreased demand for our product candidates or products that we may develop;

● injury to our reputation and significant negative media attention;

● withdrawal of clinical trial participants;

● significant costs to defend resulting litigation;

● substantial monetary awards to trial participants or patients;

● loss of revenue;

● reduced resources of our management to pursue our business strategy; and

● the inability to commercialize any products that we may develop.

We currently have insurance policies to cover liabilities under the clinic trials but do not maintain general liability insurance; and even if we have a general liability insurance in the future, this insurance may not fully cover potential liabilities that we may incur. The cost of any product liability litigation or other proceeding, even if resolved in our favor, could be substantial. We would need to increase our insurance coverage if and when we begin selling any product candidate that receives marketing approval. In addition, insurance coverage is becoming increasingly expensive. If we are unable to obtain or maintain sufficient insurance coverage at an acceptable cost or to otherwise protect against potential product liability claims, it could prevent or inhibit the development and commercial production and sale of our product candidate, which could adversely affect our business, financial condition, results of operations and prospects.

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***We have conducted, and may in the future conduct, clinical trials for certain of our product candidates at sites outside the United States, and the FDA may not accept data from trials conducted in such locations.***

We have conducted and may in the future choose to conduct one or more of our clinical trials outside the United States. Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of this data is subject to certain conditions imposed by the FDA. For example, the clinical trial must be well designed and conducted and performed by qualified investigators in accordance with ethical principles. The trial population must also adequately represent the U.S. population, and the data must be applicable to the U.S. population and U.S. medical practice in ways that the FDA deems clinically meaningful. In addition, while these clinical trials are subject to the applicable local laws, FDA acceptance of the data will be dependent upon its determination that the trials also complied with all applicable U.S. laws and regulations. There can be no assurance that the FDA will accept data from trials conducted outside of the United States. If the FDA does not accept the data from any of our clinical trials that we determine to conduct outside the United States, it would likely result in the need for additional trials, which would be costly and time-consuming and delay or permanently halt our development of the product candidate.

In addition, the conduct of clinical trials outside the United States could have a significant impact on us. Risks inherent in conducting international clinical trials include:

● foreign regulatory requirements that could restrict or limit our ability to conduct our clinical trials;

● administrative burdens of conducting clinical trials under multiple foreign regulatory schema;

● foreign exchange fluctuations; and

● diminished protection of intellectual property in some countries.

***If clinical trials of our product candidates fail to demonstrate safety and efficacy to the satisfaction of the FDA and comparable non-U.S. regulators, we may incur additional costs or experience delays in completing, or ultimately be unable to complete the development and commercialization of our product candidates.***

We are not permitted to commercialize, market, promote or sell any product candidate in the United States without obtaining marketing approval from the FDA. Comparable non-U.S. regulatory authorities impose similar restrictions. We may never receive such approvals. We must complete extensive preclinical development and clinical trials to demonstrate the safety and efficacy of our product candidate in humans before we will be able to obtain these approvals.

Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome. Any inability to successfully complete preclinical and clinical development could result in additional costs to us and impair our ability to generate revenues from product sales, regulatory and commercialization milestones, and royalties. In addition, if (1) we are required to conduct additional clinical trials or other testing of our product candidate beyond the trials and testing that we contemplate, (2) we are unable to successfully complete clinical trials of our product candidate or other testing, (3) the results of these trials or tests are unfavorable, uncertain or are only modestly favorable, or (4) there are unacceptable safety concerns associated with our product candidate, we, in addition to incurring additional costs, may:

● be delayed in obtaining marketing approval for our product candidates;

● not obtain marketing approval at all;

● obtain approval for indications or patient populations that are not as broad as we intended or desired;

● obtain approval with labeling that includes significant use or distribution restrictions or significant safety warnings, including boxed warnings;

● be subject to additional post-marketing testing or other requirements; or

● be required to remove the product from the market after obtaining marketing approval.

***Even if any of our product candidates receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, third party payors and others in the medical community necessary for commercial success and the market opportunity for the product candidate may be smaller than we estimate.***

We have never completed a new drug or new medical device FDA application process from Phase I to FDA approval and commercialization. Even if our products are approved by the appropriate regulatory authorities for marketing and sale, they may nonetheless fail to gain sufficient market acceptance by physicians, patients, third party payors and others in the medical community. For example, physicians are often reluctant to switch their patients from existing therapies even when new and potentially more effective or convenient treatments enter the market. Further, patients often acclimate to the therapy that they are currently taking and do not want to switch unless their physicians recommend switching products or they are required to switch therapies due to lack of reimbursement for existing therapies.

The potential market opportunities for our products are difficult to estimate precisely. Our estimates of the potential market opportunities are predicated on many assumptions, including industry knowledge and publications, third party research reports and other surveys. While we believe that our internal assumptions are reasonable, these assumptions involve the exercise of significant judgment on the part of our management, are inherently uncertain and the reasonableness of these assumptions has not been assessed by an independent source. If any of the assumptions proves to be inaccurate, the actual markets for our products could be smaller than our estimates of the potential market opportunities.

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***We may seek to enter into collaborations with third parties for the development and commercialization of our product candidates. If we fail to enter into such collaborations, or such collaborations are not successful, we may not be able to capitalize on the market potential of our product candidates.***

We may seek third-party collaborators for development and commercialization of our products. Our likely collaborators for any marketing, distribution, development, licensing, or broader collaboration arrangements include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies, non-profit organizations, government agencies, and biotechnology companies. Our ability to generate revenues from these arrangements will depend on our collaborators' abilities to successfully perform the functions assigned to them in these arrangements.

Collaborations involving our products will pose the following risks to us:

● collaborators may have significant discretion in determining the efforts and resources that they will apply to these collaborations;

● collaborators may not pursue development and commercialization of our product candidate or may elect not to continue or renew development or commercialization programs based on preclinical or clinical trial results, changes in the collaborators' strategic focus or available funding, or external factors such as an acquisition that diverts resources or creates competing priorities;

● collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial, or abandon a product candidate, repeat, or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;

● collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidate if the collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours;

● collaborators with marketing and distribution rights to one or more products may not commit sufficient resources to the marketing and distribution of such product or products;

● collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

● collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability;

● disputes may arise between the collaborators and us that result in the delay or termination of the research, development, or commercialization of our product candidate or that result in costly litigation or arbitration that diverts management attention and resources; and

● collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates.

Collaborative agreements may not lead to development or commercialization of our product candidate in the most efficient manner or at all. If a collaborator of ours were to be involved in a business combination, the continued pursuit and emphasis on our product development or commercialization program could be delayed, diminished, or terminated.

***We may not be successful in establishing and maintaining additional strategic partnerships, which could adversely affect our ability to develop and commercialize products, negatively impacting its operating results.***

A part of our strategy is to evaluate and as deemed appropriate, enter into additional partnerships in the future with major biotechnology or pharmaceutical companies. Our products may prove to be difficult to effectively license out as planned. Various regulatory, commercial, and manufacturing factors may impact our ability to seek co-developers of or grow revenues from licensing out any of our products in the pipeline, none of which has been fully licensed out. Specifically, we may encounter difficulty by virtue of:

● its inability to effectively identify and align with commercial partners in the U.S. to collaborate the development of our products;

● its inability to secure appropriate contract research organizations ()"**CROs**") to conduct data analysis, lab research and FDA communication; and

● its inability to effectively continue clinical studies on and secure positive research results of all of our investigational new drugs to attract additional commercial collaborators outside the U.S.

We face significant competition in seeking appropriate partners for our therapeutic candidates, and the negotiation process is time-consuming and complex. In order for us to successfully find partners for our products, potential partners must view these medicinal candidates as economically valuable in markets they determine to be attractive in light of the terms that we are seeking and compared to other available products for licensing by other companies. Even if we are successful in our efforts to establish new strategic partnerships, the terms that we agree upon may not be favorable, and it may not be able to maintain such strategic partnerships if development or approval is delayed or sales of an approved product are disappointing. Any delay in entering into new strategic partnership agreements related to any of our products could delay the development and commercialization of such candidates and reduce our competitiveness even if we reach the market.

If we fail to establish and maintain additional strategic partnerships or collaboration related to our products that have not been fully licensed, it will bear all of the risk and costs related to the development of any such drug candidate, and it may need to seek additional financing, hire additional employees and otherwise develop expertise for which it has not budgeted. This could negatively affect the development of any incompletely partnered new drug candidates.

***We may use hazardous chemicals and biological materials in its business. Any claims relating to improper handling, storage or disposal of these materials could be time consuming and costly.***

Our research and development may involve the controlled use of hazardous materials, including chemicals and biological materials. We cannot eliminate the risk of accidental contamination or discharge and any resulting injury from these materials. We may be sued for any injury or contamination that results from its use or the use by third parties of these materials, and its liability may exceed any insurance coverage and its total assets. Federal, state, and local laws and regulations govern the use, manufacture, storage, handling and disposal of these hazardous materials and specified waste products, as well as the discharge of pollutants into the environment and human health and safety matters. Although we make our best efforts to comply with environmental laws and regulations despite the associated high costs and inconvenience, we cannot guarantee that it will not mishandle any hazardous materials in the future. If we fail to comply with these requirements or any improper handling of hazardous materials occurs, we could incur substantial costs, including civil or criminal fines and penalties, clean-up costs or capital expenditures for control equipment or operational changes necessary to achieve and maintain compliance. In addition, we cannot predict the impact on our business of new or amended environmental laws or regulations or any changes in the way existing and future laws and regulations are interpreted and enforced.

***Our operations are cash-intensive, and if we are unable to maintain adequate liquidity and working capital, our business and the operations of our subsidiaries could be materially adversely affected.***

Our business requires significant working capital to fund operating expenses, including the procurement of raw materials, manufacturing activities, personnel costs, and general administrative expenses. Information regarding our historical cash balances and liquidity is included in the consolidated financial statements and related notes contained elsewhere in this filing.

We have historically relied on a combination of operating cash flows and short-term and long-term borrowings to fund our working capital needs. If our customers delay or fail to pay outstanding receivables, if our access to bank financing or other sources of capital becomes limited, or if our operating cash flows are insufficient to meet our obligations, our liquidity, financial condition, and results of operations could be materially adversely affected. In addition, adverse economic conditions, changes in credit markets, or increased borrowing costs could further restrict our ability to obtain necessary financing on acceptable terms, or at all.

***We face short lead-times for delivery of products to customers. Failure to meet delivery deadlines could result in the loss of customers and damage to our reputation and goodwill.***

Most of our customers are large manufacturers, who generally place large orders for our subsidiaries' products and require prompt delivery. Our product sale agreements typically contain short lead-times for the delivery of products and tight production and manufacturer supply schedules that can reduce our profit margins on the products procured from our subsidiaries' suppliers. Our suppliers may lack sufficient capacity at any given time to meet all of the demands from our customers if orders exceed their production capacity. We strive for rapid response to customer demands, which can lead to reduced purchasing efficiency, increased procurement costs and low profit margins. If we are unable to meet the customer demands, they may lose customers. Moreover, failure to meet customer demands may damage our reputation and goodwill.

***We face intense competition, and, if we are unable to compete effectively, we may not be able to maintain profitability.***

We compete with many other companies that manufacture similar products. Many of our competitors are larger companies with greater financial resources. Intense competition in a challenging economic environment has, in the past, put pressure on our margins and may adversely affect our future financial performance. Moreover, intense competition may result in potential or actual litigation with our competitors relating to such activities as competitive sales practices, relationships with key suppliers and customers or other matters.

It is likely that our competitors will seek to develop similar competing products in the near future. Some of our competitors may have more resources than we do, operate in greater scale, be more capitalized than we are, have access to cheaper raw materials than our subsidiaries do, or offer products at a more competitive price. There can be no assurance that our initial competitive advantage will be retained and that one or more competitors will not develop products that are equal or superior in quality and are better priced than our products. If we are unable to compete effectively, our results of operations and financial position may be materially and adversely affected.

***Our revenues are dependent on a limited number of customers, and the loss of any significant customer could materially adversely affect our business.***

A substantial portion of our historical revenues has been derived from a limited number of customers. The degree of customer concentration, including the contribution of our largest customers to total revenue for the relevant reporting periods, is disclosed in the consolidated financial statements and related notes included elsewhere in this filing.

Because of this concentration, the loss of any significant customer, a reduction in order volume, unfavorable pricing changes, delays in customer programs, or the termination or completion of customer projects could materially and adversely affect our revenues, profitability, and operating results. In addition, we are generally not the exclusive provider to our customers, and our customers may shift purchases to competitors or alternative suppliers at any time.

Customer concentration may also provide certain customers with greater negotiating leverage, which could result in pricing pressure, less favorable contractual terms, extended payment cycles, or reduced order volumes. If we are unable to diversify our customer base or expand relationships with existing customers, our future performance may remain significantly dependent on a small number of customers and their respective business and financial conditions.

***As we expand our operations, we may need to establish a more diverse supplier network for raw materials. The failure to secure a more diverse supplier network could have an adverse effect on our financial condition.***

In the event that we need to diversify our supplier network, we may not be able to procure a sufficient supply of raw materials at a competitive price, which could have an adverse effect on our results of operations, financial condition and cash flows. Furthermore, despite our efforts to control the supply of raw materials and maintain good relationships with our existing suppliers, we could lose one or more of our existing suppliers at any time. The loss of one or more key suppliers could increase our reliance on higher cost or lower quality supplies, which could negative affect our profitability. Any interruptions to, or decline in, the amount or quality of our raw materials supply could materially disrupt our production and adversely affect our business, our financial condition, and financial prospects.

***New lines of business may subject us to additional risks.***

From time to time, we may implement new lines of business or offer new products within our existing lines of business. As such, we face significant challenges, uncertainties, and risks, including, among others, with respect to our ability to:

● build a well-recognized and respected brand;

● establish and expand our customer base;

● improve and maintain our operational efficiency for new lines of business;

● maintain a reliable, secure, high-performance, and scalable technology infrastructure for our new lines of business;

● anticipate and adapt to changing market conditions, including technological development and changes in competitive landscape;

● navigate an evolving and complex regulatory environment, such as licensing and compliance requirements; and

● manage the resources and attention of management between our current core business and new lines of business.

Moreover, there can be no assurance that the introduction and development of new lines of business or new products and services would not encounter significant difficulties or delay or would achieve the profitability as we expect. Failure to successfully manage these risks in the development and implementation of new lines of business or new products or services could have a material adverse effect on our subsidiaries' business and our results of operations and prospects.

As we enter into new business sectors, we are also subject to competition from such industries. There can be no assurance that we will be able to compete effectively with respect to their new businesses. If we fail to establish our strengths or maintain our competitiveness in those industries, our business prospects, results of operations, and financial condition may be materially and adversely affected.

***We are subject to various risks and uncertainties that might affect our ability to procure raw materials.***

Our performance depends upon our ability to procure low cost, high quality raw materials on a timely basis from their suppliers. Our suppliers are subject to certain risks, including the availability of raw materials, labor disputes, inclement weather, natural disasters, and general economic and political conditions, which might limit the ability of our suppliers to provide low-cost, high-quality merchandise on a timely basis. Furthermore, for these or other reasons, one or more of our suppliers might not adhere to our quality control standards, and we might not identify the deficiency. Any failure by our suppliers to supply quality materials at a reasonable cost on a timely basis could reduce our net sales or profits, damage our reputation, and have an adverse effect on our financial condition.

***We may lose our competitive advantage, and our operations may suffer, if we fail to prevent the loss or misappropriation of, or disputes over, our intellectual property.***

We rely on a combination of patents, trademarks, trade secrets, and confidentiality agreements to protect our intellectual property rights. While we are not currently aware of any infringement of our intellectual property rights, our ability to compete successfully and to achieve future revenue growth will depend, in significant part, on our ability to protect our proprietary technology. Our technology is protected through a combination of patents, trade secrets, confidentiality agreements, and other methods. However, our competitors may independently develop similar proprietary methodologies or duplicate our products, or develop alternatives, which could have a material adverse effect on our business and our results of operations and financial condition. The misappropriation or duplication of our intellectual property could disrupt their ongoing business, distract our management and employees, reduce our revenues, and increase our expenses. We may need to litigate to enforce our intellectual property rights. Any such litigation could be time consuming and costly and the outcome of any such litigation cannot be guaranteed.

***We have limited insurance coverage for our operations and may incur losses resulting from product liability claims, business interruption, or natural disasters.***

We have limited insurance coverage for our operations and are therefore exposed to risks associated with product liability claims against us or otherwise against our operations in the event that the use of our products results in property damage or personal injury. We are unable to predict whether product liability claims will be brought against us in the future or to predict the impact of any resulting adverse publicity on our business. The successful assertion of product liability claims against us could result in potentially significant monetary damages and require us to make significant payments. We do not carry product liability insurance and may not have adequate resources to satisfy a judgment in the event of a successful claim against us. In addition, we do not currently, and may not in the future, maintain business interruption insurance coverage. As such, we may suffer losses that result from interruptions in our operations as a result of inability to operate or failures of equipment and infrastructure at our facilities. We also do not currently maintain catastrophe insurance. As such, any natural disaster or man-made disaster could result in substantial losses and diversion of our resources to address the effects of such an occurrence, which could materially and adversely affect our business and our financial condition and results of operations.

***If labor costs increase substantially, our business and our costs of operations may be adversely affected.***

In recent years, the economy has experienced inflation and labor cost increases. Average wages are projected to continue to increase. We expect that our labor costs, including wages and employee benefits, will continue to increase based on the past trends. If we are unable to control our labor costs or pass such increased labor costs on to our customers, our financial condition and results of operations may be adversely affected.

***We may not be able to effectively protect our intellectual property from unauthorized use by others.***

We hold trademarks and other intellectual properties that are critical to our business. Any of our intellectual property rights could be challenged, invalidated, circumvented, or misappropriated, or such intellectual property may not be sufficient to provide us with competitive advantages. We cannot assure you that (i) all of the intellectual property rights we owned will be adequately protected, or (ii) our intellectual property rights will not be challenged by third parties or found by a judicial authority to be invalid or unenforceable. Moreover, there can be no assurance that we will obtain such trademarks and any other trademarks that are crucial to our business in the future. Thus, third parties may also take the position that we are infringing their rights, and we may not be successful in defending these claims. Additionally, we may not be able to enforce and defend its proprietary rights or prevent infringement or misappropriation, without incurring substantial expenses to us and a significant diversion of management time and attention from our business strategy.

To protect our patents, trademarks, and other proprietary rights, we rely on and expect to continue to rely on a combination of physical and electronic security measures, and trademark, patent, and trade secret protection laws. If the measures we have taken to protect our proprietary rights are inadequate to prevent the use or misappropriation by third parties or such rights are diminished due to successful challenges, the value of our brand and other intangible assets may be diminished and our ability to attract and retain customers may be adversely affected.

***Competition for our employees is intense, and we may not be able to attract and retain the highly skilled employees needed to support our business.***

As we continue to experience growth, our future success depends on our ability to attract, develop, motivate, and retain highly qualified and skilled employees, including engineers, financial personnel, and marketing professionals. Competition for highly skilled engineering, sales, technical, and financial personnel is extremely intense. We may not be able to hire and retain these personnel at compensation levels consistent with our existing compensation and salary structure. Many of the companies with which we compete for experienced employees have greater resources than we have and may be able to offer more attractive terms of employment.

In addition, we invest significant time and expense in training our employees, which increases their value to competitors who may seek to recruit them. If we fail to retain our employees, we could incur significant expenses in hiring and training their replacements, and the quality of our products could decrease, resulting in a material adverse effect on our business.

***Our business depends on the continued efforts of our senior management. If one or more of our key executives were unable or unwilling to continue in their present positions, our business may be severely disrupted.***

Our business operations depend on the continuing services of our senior management. While we have provided different incentives to our management, we cannot assure you that we can continue to retain their services. If one or more of our key executives were unable or unwilling to continue in their present positions, we may not be able to replace them easily or at all, our future growth may be constrained, business may be severely disrupted and our financial condition and results of operations may be materially and adversely affected, and we may incur additional expenses to recruit, train, and retain qualified personnel.

***We do not maintain "key person" insurance, and as a result, we may incur losses if any of our directors, executive officers, senior manager, or other key employees chooses to terminate his or her services with us.***

We do not maintain "key person" insurance for our directors, executive officers, senior management, or other key employees. If any of our key employees terminate his or her services or otherwise becomes unable to provide continuous services to us, our business, financial condition, and results of operations may be materially and adversely affected, and we may incur additional expenses to recruit, train, and retain qualified personnel. If any of our executive officers or key employees joins a competitor or forms a competing company, we may lose customers, operational know-how, and key professionals and staff members.

***We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing invasion of Ukraine by Russia.***

U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and Russia's launch of a full-scale military invasion of Ukraine in February 2022. Although the length and impact of the ongoing military conflict is highly unpredictable, the war in Ukraine has led to market disruptions, including significant volatility in commodity prices, credit, and capital markets. In addition, as a result of the ongoing conflict between Russia and Ukraine, we may experience other risks, difficulties and challenges in the way we conduct our business and operations generally. For example, the conflict could adversely affect supply chains and impact our ability to control raw material costs. A protracted conflict between Ukraine and Russia, any escalation of that conflict, and the wider global economy and market conditions could, in turn, have a material adverse impact on our business, financial condition, cash flows, and results of operations and could cause the market value of our Ordinary Shares to decline.

***High inflation rates may adversely affect us by increasing costs beyond what we can recover through price increases and limit our ability to enter into future traditional debt financing.***

Inflation can adversely affect us by increasing costs of critical materials, equipment, labor, and other services. In addition, inflation is often accompanied by higher interest rates. Continued inflationary pressures could impact our profitability. Inflation may also affect our ability to enter into future traditional debt financing, as high inflation may result in an increase in cost.

***Because we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. Federal courts may be limited.***

We are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against our directors or officers.

Our corporate affairs will be governed by our amended and restated memorandum and articles of association, the Companies Act of the Cayman Islands (As Revised) (as the same may be supplemented or amended from time to time) and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are different from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a federal court of the United States.

We have been advised by Conyers, Dill and Pearman, LLP, our Cayman Islands legal counsel, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature. The Cayman Islands court will not enforce criminal fines and tax judgments and judgments that are contrary to Cayman Islands public policy. However, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a United States company.

***Economic substance legislation of the Cayman Islands may adversely impact us or our operations.***

The Cayman Islands, together with several other non-European Union jurisdictions, have introduced legislation aimed at addressing concerns raised by the Organisation for Economic Co-operation and Development's (OECD) Base Erosion and Profit Shifting (BEPS) initiative as to offshore structures engaged in certain activities which attract profits without real economic activity. The International Tax Co-operation (Economic Substance) Act, (As Revised) (the "**Economic Substance Act**") contains economic substance requirements for in-scope Cayman Islands entities which are engaged in certain "relevant activities". As we are a Cayman Islands company, our compliance obligations will include filing an annual notification, which need to state whether we are carrying out any relevant activities and if so, whether we have satisfied economic substance tests to the extent required under the Economic Substance Act. If the Cayman Islands Tax Information Authority determines that the Company or any of its Cayman Islands subsidiaries has failed to meet the requirements imposed by the Economic Substance Act the Company may face significant financial penalties, restriction on the regulation of its business activities and/or may be struck off as a registered entity in the Cayman Islands.

As it is still a relatively new regime, it is anticipated that the Economic Substance Act and associated guidance will evolve and may be subject to further clarification and amendments. We may need to allocate additional resources to keep updated with these developments and may have to make changes to our operations in order to comply with all requirements under the Economic Substance Act. Failure to satisfy these requirements may subject us to penalties under the Economic Substance Act.

***We are dependent on our senior management team and other key employees, and the loss of any such personnel could materially and adversely affect our business, operating results, and financial conditions.***

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We believe that our performance and success are, to a certain extent, attributable to the extensive industry knowledge and experience of our key executives and personnel. Our continued success is dependent primarily on the ability to attract and retain the services of the key management team. However, competition for key personnel in our industry is intense. We may not be able to retain the services of our directors or other key personnel or attract and retain high-quality personnel in the future. If any of our key personnel departs from us, and we are not able to recruit a suitable replacement with comparable experience to join us on a timely basis, our business, operations, and financial conditions may be materially and adversely affected.

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***If we experience delays in clinical testing, we will be delayed in commercializing our product candidates, and our business may be substantially harmed.***

 

We cannot predict whether any clinical trials will begin as planned, will need to be restructured, or will be completed on schedule, or at all. Our product development costs will increase if we experience delays in clinical testing. Significant clinical trial delays could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before us, which would impair our ability to successfully commercialize our product candidates and may harm our financial condition, results of operations and prospects. The commencement and completion of clinical trials for our products may be delayed for a number of reasons, including delays related, but not limited, to:

● failure by regulatory authorities to grant permission to proceed or placing the clinical trial on hold;

● import/export and research restrictions for cannabinoid-based pharmaceuticals may delay or prevent clinical trials in various geographical jurisdictions;

● patients failing to enroll or remain in our trials at the rate we expect;

● suspension or termination of clinical trials by regulators for many reasons, including concerns about patient safety or failure of our contract manufacturers to comply with cGMP requirements;

● any changes to our manufacturing process that may be necessary or desired;

● delays or failure to obtain clinical supply from contract manufacturers of our products necessary to conduct clinical trials;

● product candidates demonstrating a lack of safety or efficacy during clinical trials;

● patients choosing an alternative treatment for the indications for which we are developing any of our product candidates or participating in competing clinical trials and/or scheduling conflicts with participating clinicians;

● patients failing to complete clinical trials due to dissatisfaction with the treatment, side effects or other reasons;

● reports of clinical testing on similar technologies and products raising safety and/or efficacy concerns;

● clinical investigators not performing our clinical trials on their anticipated schedule, dropping out of a trial, or employing methods not consistent with the clinical trial protocol, regulatory requirements or other third parties not performing data collection and analysis in a timely or accurate manner;

● failure of our Contract Research Organization ()"**CROs** "), to satisfy their contractual duties or meet expected deadlines;

● inspections of clinical trial sites by regulatory authorities or Institutional Review Boards ()"**IRBs**") or ethics committees finding regulatory violations that require us to undertake corrective action, resulting in suspension or termination of one or more sites or the imposition of a clinical hold on the entire study;

● one or more Institutional Review Boards ()"**IRBs**") or ethics committees rejecting, suspending, or terminating the study at an investigational site, precluding enrollment of additional subjects, or withdrawing its approval of the trial; or

● failure to reach agreement on acceptable terms with prospective clinical trial sites.

Our product development costs will increase if we experience delays in testing or approval or if we need to perform more or larger clinical trials than planned. Additionally, changes in regulatory requirements and policies may occur, and we may need to amend study protocols to reflect these changes. Amendments may require us to resubmit our study protocols to regulatory authorities or ethics committees for re-examination, which may impact the cost, timing, or successful completion of that trial. Delays or increased product development costs may have a material adverse effect on our business, financial condition, and prospects.

***We have limited insurance to cover our potential losses and claims.***

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We purchase and maintain insurance policies that we believe are customary with the standard commercial practice in our industry and as required under the relevant laws and regulations. However, we cannot guarantee that our insurance policies will provide adequate coverage for all the risks in connection with our business operations. Consistent with customary practice in the relevant industry, we do not carry any business interruption, product liability, or litigation insurance. If we were to incur substantial losses and liabilities that are not covered by our insurance policies, we could suffer significant costs and diversion of our resources, which could have a material and adverse effect on our financial conditions and results of operations. We may be required to bear our losses to the extent that our insurance coverage is insufficient.

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***Our current products have certain side effects. If the side effects associated with our current or future products are not identified prior to their marketing and sale, we may be required to withdraw such products from the market, perform lengthy additional clinical trials or change the labeling of our products, any of which could adversely impact our growth.***

The Company researches and develops Maitake mushroom supplements. Side effects, or adverse events, associated with Maitake mushroom extract include blood bilirubin increase, lymphocyte count decrease, neutrophil count decrease, platelet count decrease, white blood cell decrease, headache, and hyperglycemia. Serious adverse events (collectively, the "**SAE**") associated with this compound include leukocytosis, platelet count decrease, eye disorders, abdominal pain, gastrointestinal disorders, aphonia, lung infection, muscle weakness right-sided, confusion, edema cerebral, stroke, dyspnea, wheezing, and pruritus. The occurrence of any of those adverse events would harm our future sales of these medicines and substantially increase the costs and expenses of marketing these medicines, which in turn could cause our revenues and net income to decline. In addition, the reputation and sales of our future medicines could be adversely affected due to the severe side effects discovered.

**Risks Related to Our Ordinary Shares and the Securities Market**

***No public trading market for our Ordinary Shares exists or is expected to exist at the time of the Share Distribution, and we do not intend to apply for quotation on the OTC Markets until after the completion of the Spin-Off. There can be no assurance that our Ordinary Shares will ever be quoted on the OTC Markets or that an active trading market will develop.***

There is currently no public market for our Ordinary Shares, and no public trading market for our Ordinary Shares is expected to exist at the time of the Share Distribution. We do not intend to apply for quotation of our Ordinary Shares on the OTC Markets until after the completion of the Spin-Off. Following the completion of the Spin-Off, the OTC application and review process may take a significant period of time, and there can be no assurance as to the timing of such quotation or that our application will be approved. During the period between the Share Distribution Date and the date, if any, on which our Ordinary Shares are quoted on the OTC Markets, holders of our Ordinary Shares will have no ability to sell or transfer their shares in the public market. Even if our Ordinary Shares are ultimately quoted on the OTC Markets, there can be no assurance that an active or liquid trading market will develop or be sustained. The lack of an active market may make it more difficult for shareholders to sell our Ordinary Shares and could lead to the price of our Ordinary Shares being depressed or volatile.

We cannot predict the prices at which our Ordinary Shares may trade after the Spin-Off or whether the combined market value of our Ordinary Shares and ABVC Common Stock will be less than, equal to, or greater than the market value of ABVC Common Stock prior to the Spin-Off. The market price of our Ordinary Shares may fluctuate widely, depending on many factors, some of which may be beyond our control, including:

● actual or anticipated fluctuations in our results of operations due to factors related to our business;

● success or failure of our business strategies;

● competition and industry capacity;

● changes in interest rates and other factors that affect earnings and cash flow;

● our ability to retain and recruit qualified personnel;

● our quarterly or annual earnings, or those of other companies in our industry;

● announcements by us or our competitors of significant acquisitions or dispositions;

● changes in accounting standards, policies, guidance, interpretations, or principles

● the failure of securities analysts to cover, or positively cover, our Ordinary Shares after the Spin-Off;

● changes in earnings estimates by securities analysts or our ability to meet those estimates

● the operating and stock price performance of other comparable companies;

● investor perception of our Company and our industry;

● overall market fluctuations unrelated to our operating performance;

● results from any material litigation or government investigation;

● changes in laws and regulations (including tax laws and regulations) affecting our business;

● changes in capital gains taxes and taxes on dividends affecting shareholders; and

● general economic conditions and other external factors.

Furthermore, our business profile and market capitalization may not fit the investment objectives of some ABVC shareholders and, as a result, these ABVC shareholders may sell our Ordinary Shares that they have after the Share Distribution. See "*Risk Factors—Risks Related to Our Ordinary Shares and the Securities Market—Substantial sales of our Ordinary Shares may occur in connection with the Spin-Off, which could cause our stock price to decline*." Low trading volume for our Ordinary Shares, which may occur if an active trading market does not develop, among other reasons, would amplify the effect of the above factors on our stock price volatility.

Should the market price of our Ordinary Shares drop significantly, shareholders may institute securities class action lawsuits against the Company. A lawsuit against us could cause us to incur substantial costs and could divert the time and attention of our management and other resources.

***Substantial sales of our Ordinary Shares may occur in connection with the Spin-Off, which could cause our stock price to decline.***

ABVC shareholders receiving our Ordinary Shares in the Share Distribution generally may sell those Ordinary Shares immediately in the public market. It is likely that some ABVC stockholders, which may include some of its larger stockholders, will sell our Ordinary Shares that they received in the Share Distribution if, for reasons such as our business profile or market capitalization as an independent company, we do not fit their investment objectives, or, in the case of index funds, we are not a participant in the index in which they are investing. The sales of significant amounts of our Ordinary Shares or the perception in the market that such sales might occur may decrease the market price of our Ordinary Shares.

***Since we do not expect to pay dividends in the foreseeable future, you must rely on the price appreciation of our Ordinary Shares for a return on your investment.***

We currently intend to retain most, if not all, of our available funds and any future earnings to fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in our Ordinary Shares as a source for any future dividend income.

Our Board has complete discretion as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. Even if our Board decides to declare and pay dividends, the timing, amount, and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us, our financial condition, contractual restrictions, and other factors deemed relevant by our Board. Accordingly, the return on your investment in our Ordinary Shares will likely depend entirely upon any future price appreciation of our Ordinary Shares. There is no guarantee that our Ordinary Shares will appreciate in value or even maintain the price at which you received the Ordinary Shares. You may not realize a return on your investment in our Ordinary Shares and you may even lose your entire investment in our Ordinary Shares.

***Your percentage ownership in the Company may be diluted in the future.***

Your percentage ownership in the Company may be diluted in the future because of equity issuances for acquisitions, capital market transactions or otherwise, including equity awards that we may be granting to our directors, officers, and other employees. We expect to have one or more equity compensation plans that will provide for the grant of equity awards to our directors, officers, and other employees. Such awards will have a dilutive effect on our earnings per share, which could adversely affect the market price of our Ordinary Shares.

***The rights associated with our Ordinary Shares may differ from the rights associated with shares of ABVC Common Stock.***

Upon completion of the Share Distribution, the rights of ABVC stockholders who become Company shareholders will be governed by the Memorandum and Articles of Association of the Company and by Cayman Islands law. The rights associated with shares of ABVC Common Stock are different from the rights associated with our Ordinary Shares. Material differences between the rights of stockholders of ABVC and the rights of shareholders of the Company include differences with respect to, among other things, the removal of directors, the convening of general meetings of shareholders, shareholder approval of certain transactions, anti-takeover measures and provisions relating to the ability to amend the Memorandum and Articles of Association of the Company. See "*Description of Our Shares —Certain Provisions of Cayman Islands Law, Our Memorandum and Articles of Association*" for more information.

***If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired and investors' views of us could be harmed.***

The Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, with auditor attestation of the effectiveness of our internal controls, beginning with our required annual report on Form 10-K. If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our Ordinary Shares could decline and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

Our ability to successfully implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate financial statements. Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures, or controls, may cause our operations to suffer, and we may be unable to conclude that our internal control over financial reporting is effective and to obtain an unqualified report on internal controls from our auditor as required under Section 404 of the Sarbanes-Oxley Act. Moreover, we cannot be certain that these measures would ensure that we implement and maintain adequate controls over our financial processes and reporting in the future. Even if we were to conclude, and our auditor were to concur, that our internal control over financial reporting provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America ("**U.S. GAAP**"), because of its inherent limitations, internal control over financial reporting might not prevent or detect fraud or misstatements. This, in turn, could have an adverse impact on trading prices for our Ordinary Shares, and could adversely affect our ability to access the capital markets.

**Risks Relating to the Spin-Off**

***Until the Spin-Off occurs, ABVC has sole discretion to change the terms of the Spin-Off in ways that may be unfavorable to us.***

Until the Spin-Off occurs, the Company will be a wholly owned subsidiary of ABVC. Accordingly, ABVC will effectively have the absolute discretion to determine and change the terms of the Spin-Off, including the establishment of the record date for the Share Distribution and the Share Distribution Date. These changes could be unfavorable to us. In addition, the Spin-Off, Share Distribution, and the related transactions are subject to the satisfaction or waiver by ABVC in its sole discretion of a number of conditions. We cannot assure you that any or all of these conditions will be met. ABVC may also decide at any time not to proceed with the Spin-Off or the Share Distribution.

***We may be unable to achieve some or all of the benefits that we expect to achieve from the Spin-Off.***

We believe that, as an independent company, we will be able to, among other things, design and implement corporate strategies and policies that are better targeted to our business's areas of strength and differentiation, better focus our financial and operational resources on those specific strategies, create effective incentives for our management and employees that are more closely tied to our business performance, provide investors more flexibility and enable us to achieve alignment with a more natural shareholder base and implement and maintain a capital structure designed to meet our specific needs. We may be unable to achieve some or all of the benefits that we expect to achieve as an independent company in the time we expect, if at all, for a variety of reasons, including: (i) the completion of the Spin-Off will require significant amounts of our management's time and effort, which may divert management's attention from operating and growing our business; (ii) following the Spin-Off, we may be more susceptible to market fluctuations and other adverse events than if it were still a part of ABVC; and (iii) following the Spin-Off, our business will be less diversified than ABVCs businesses prior to the Spin-Off. If we fail to achieve some or all of the benefits that we expect to achieve as an independent company, or do not achieve them in the time we expect, our business, financial condition, results of operations, and cash flows could be adversely affected.

***Our executive officers and directors may have conflicts of interest because certain members of our management team also serve as executive officers or directors of ABVC, which could adversely affect our business, results of operations, and strategic decision-making.***

Following the completion of the Spin-Off, Dr. Tsung-Shann (T.S.) Jiang, who currently serves as Chief Scientific Officer, Chief Strategy Officer, and a director of ABVC, will serve as our Chief Executive Officer. Eugene Jiang, who currently serves as the Chairman of the Board and Chief Business Officer of ABVC will serve as our Chief Financial Officer and will be on the Board. In addition, Uttam Patil, the current Chief Executive Officer of ABVC, will serve as our Chief Scientific Officer. As a result, certain members of our management team will have ongoing responsibilities to both BioKey Cayman and ABVC and will owe fiduciary duties to both companies.

These overlapping roles may create actual or potential conflicts of interest in allocating time, attention, and resources between BioKey Cayman and ABVC, and may arise in connection with strategic planning, operational priorities, capital allocation, research and development focus, and potential transactions or commercial arrangements between the two companies. Because ABVC will retain a significant equity interest in BioKey Cayman following the Spin-Off, ABVC will continue to have the ability to influence matters requiring shareholder approval and other corporate actions, and the interests of ABVC may not always align with the interests of BioKey Cayman's public shareholders.

In addition, because of their current or former positions with ABVC, certain of our directors and executive officers own ABVC common stock and equity awards. These financial interests could create, or appear to create conflicts of interest if decisions are made that have different implications for BioKey Cayman and ABVC.

Although our Board of Directors is expected to consist of a majority of independent directors following the Spin-Off, we cannot assure you that the conflicts described above will be resolved in a manner favorable to BioKey Cayman or its public shareholders. Any failure to effectively manage these conflicts could adversely affect our business, financial condition, results of operations, and the market price of our Ordinary Shares.

***We may be unable to make, on a timely or cost-effective basis, the changes necessary to operate as an independent company, and we may experience increased costs after the Spin-Off.***

We have historically operated as part of ABVC corporate organization, and ABVC has provided us with various corporate functions. Following the Spin-Off, ABVC will have no obligation to provide us with assistance.

Following the Spin-Off, we will need to provide internally or obtain from unaffiliated third parties the services we will no longer receive from ABVC. These services may include legal, accounting, information technology, human resources, investor relations, and other infrastructure support, the effective and appropriate performance of which are critical to our operations.

We may be unable to replace these services in a timely manner or on terms and conditions as favorable as those we receive from ABVC. Since our business has historically operated as part of the wider ABVC organization, we may be unable to successfully establish the infrastructure or implement the changes necessary to operate independently or may incur additional costs that could adversely affect our business. If we fail to obtain the quality of services necessary to operate effectively or incur greater costs in obtaining these services, our business, financial condition, results of operations, and cash flows may be adversely affected.

***We may incur new indebtedness post the Share Distribution, and the degree to which we will be leveraged following completion of the Share Distribution could adversely affect our business, financial condition, and results of operations.***

Post the Spin-Off, from time to time in the ordinary course of our business, we may incur indebtedness to fund the growth of the business. If needed, we also may enter into a revolving credit facility to be available for our working capital and other cash needs.

After the Share Distribution, we will not be able to rely on the earnings, assets, or cash flow of ABVC, and ABVC will not provide funds to finance our working capital or other cash requirements. As a result, after the Share Distribution, we will be responsible for servicing our own debt and obtaining and maintaining sufficient working capital and other funds to satisfy our cash requirements. Any differences in access to and cost of debt financing may result in differences in the interest rate charged to us on financings, as well as the amount of indebtedness, types of financing structures and debt markets that may be available to us.

Our ability to make payments on and to refinance our future indebtedness will depend on our ability to generate cash in the future from operations, financings, or asset sales. Our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control, as well as the risk factors set forth herein.

***Our customers, prospective customers, suppliers, or other companies with whom we conduct business may need assurances that our financial stability on a stand-alone basis is sufficient to satisfy their requirements for doing or continuing to do business with them.***

Some of our customers, prospective customers, suppliers, or other companies with whom we conduct business may need assurances that the Company's financial stability on a stand-alone basis is sufficient to satisfy their requirements for doing or continuing to do business with them. Any failure of parties to be satisfied with our financial stability could have an adverse effect on our business, financial condition, results of operations, and cash flows.

***We may have potential business conflicts of interest with ABVC with respect to our past and ongoing relationships.***

Conflicts of interest may arise with ABVC in a number of areas relating to our past and ongoing relationships, including employee recruiting and retention, and business combinations involving our Company.

***We may not be able to resolve any potential conflicts, and, even if we do so, the resolution may be less favorable to us than if we were dealing with an unaffiliated party.***

Following the Spin-Off, certain of our directors and employees may have actual or potential conflicts of interest because of their financial interests in ABVC and other companies for which our executive officers and directors may be affiliates of. Since their current or former positions with ABVC, certain of our expected executive officers and directors, own equity interests in ABVC. Continuing ownership of ABVC shares and equity awards could create or appear to create potential conflicts of interest if the Company and ABVC face decisions that could have implications for both the Company and ABVC.

***Our prior association with ABVC may cause negative developments at ABVC to create reputational or operational risks for us.***

Although we will operate as an independent entity following the Spin-Off, our prior association with ABVC may cause market participants, regulators, or other stakeholders to perceive a continuing connection between the two companies. As a result, any adverse developments at ABVC, such as negative publicity, regulatory inquiries, compliance failures, or financial difficulties, could create reputational or operational risks for us. This potential spillover effect may adversely affect our ability to attract new investors, establish partnerships, or obtain regulatory approvals, even if such developments are unrelated to our business or operations.

**CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS**

This information statement contains "forward-looking statements" that involve risks and uncertainties. These statements can be identified by the fact that they do not relate strictly to historical or current facts, but rather are based on current expectations, estimates, assumptions and projections about our industry and our business and financial results. Forward-looking statements often include words such as "anticipates," "estimates," "expects," "projects," "forecasts," "intends," "plans," "continues," "believes," "may," "will," "goals" and words and terms of similar substance in connection with discussions of future operating or financial performance. As with any projection or forecast, forward-looking statements are inherently susceptible to uncertainty and changes in circumstances. Our actual results may vary materially from those expressed or implied in our forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statement made by us or on our behalf. Although we believe that the forward-looking statements contained in this information statement are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in such forward-looking statements, including but not limited to:

● lack of operating history as an independent company and unreliability of historical consolidated financial information as an indicator of our future results;

● the level of competition from other companies;

● inflationary pressures and availability and price of industrial supplies;

● our ability to generate sufficient cash or obtain financing to fund our business operation;

● changes in prevailing global and regional economic conditions;

● natural disasters or inclement or hazardous weather conditions, including, but not limited to cold weather, flooding, tornadoes, and the physical impacts of climate change;

● ability to operate as an independent company without certain benefits available to us as a part of ABVC;

● attracting and retaining key personnel and other employee workforce factors, such as labor relations;

● technical difficulties or failures;

● work stoppages, other disruptions, or the need to relocate any of our facilities;

● economic, political, regulatory, foreign exchange, and other risks of international operations;

● changes in legislation or government regulations or policies;

● our production capabilities and costs;

● our ability to obtain, maintain or renew any necessary permits or rights;

● difficulty collecting receivables;

● the failure to protect our intellectual property or allegations that we have infringed the intellectual property of others;

● inability to grow successfully through future acquisitions;

● inability to recruit and retain qualified personnel;

● the operational constraints and financial distress of third parties;

● labor disputes;

● our ability to borrow funds and access capital markets;

● potential material litigation matters;

● unforeseen U.S. federal income tax and foreign tax liabilities;

● U.S. federal income tax reform; and

● certain factors discussed elsewhere in this information statement.

These and other factors are more fully discussed in the "*Risk Factors*" and "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" sections and elsewhere in this information statement. These risks could cause actual results to differ materially from those implied by forward-looking statements in this information statement. Even if our results of operations, financial condition, and liquidity and the development of the industry in which we operate are consistent with the forward-looking statements contained in this information statement, those results or developments may not be indicative of results or developments in subsequent periods.

Any forward-looking statements made by us in this information statement speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.

**THE SPIN-OFF**

**Background**

On May [ ], 2026, ABVC announced plans for the partial legal and structural separation of the business from ABVC. To affect the Spin-Off, ABVC is undertaking the reorganization transactions (the "**Reorganization Transactions**") described under "*Certain Relationships and Related Party Transactions—Agreements with ABVC—Separation and Distribution Agreement*."

Following the Reorganization Transactions, ABVC will distribute [ ]% of its equity interest in us, consisting of [ ] of our outstanding Ordinary Shares, to holders of ABVCs Common Stock on a pro rata basis. Following the Spin-Off, it is anticipated that ABVC will retain [ ]% ownership interest in our Company, and we will operate independently from ABVC. No approval of ABVCs shareholders is required in connection with the Spin-Off, and ABVCs shareholders will not have any appraisal rights in connection with the Spin-Off.

Completion of the Spin-Off is subject to the satisfaction, or ABVC Board's waiver, to the extent permitted by law, of a number of conditions. In addition, ABVC may at any time until the Share Distribution decide to abandon the Share Distribution or modify or change the terms of the Share Distribution. For a more detailed discussion, see "*The Spin-Off—Conditions to the Spin-Off.*"

Aspects of the Spin-Off may increase the risks associated with ownership of shares of SpinCo. In connection with the Spin-Off, from time to time in the ordinary course of our business, we may incur indebtedness in the future. If needed, we may also enter into a revolving credit facility to be available for our working capital and other cash needs. Furthermore, as an independent entity we may lose some of the benefits of purchasing power, borrowing leverage and available capital for investments associated with being part of a larger entity. See "*Risk Factors*" in this information statement.

**Reasons for the Spin-Off**

In 2025, the ABVC Board authorized a review of ABVCs business portfolio and capital allocation options, with the goal of enhancing shareholder value. As part of its review process, ABVC evaluated a range of potential structural alternatives in addition to the Spin-Off, including opportunities for dispositions, acquisitions, business combinations and separations. ABVC considered several factors, including the strategic clarity and flexibility for ABVC and SpinCo after the Spin-Off, the ability of SpinCo to compete and operate efficiently and effectively (including SpinCo's ability to retain and attract management talent) after the Spin-Off, the financial profile of SpinCo and the potential reaction of investors. As a result of this review, ABVC identified differences in operations, strategic focus, and growth drivers of ABVCs business and the business, including that the business would not fully utilize synergies across the ABVC portfolio. In reaching the decision to separate the business, the ABVC Board concluded that the Spin-Off of the business from the remainder of ABVC as a stand-alone company is the most attractive alternative for enhancing shareholder value.

As a result of this evaluation, ABVC determined that proceeding with the Spin-Off would be in the best interests of ABVC and its shareholders. ABVC considered the following potential benefits of this approach:

**Enhanced Strategic and Operational Focus**. Following the Spin-Off, ABVC and SpinCo will each have a more focused business and be better able to dedicate financial, management, and other resources to leverage their respective areas of strength and differentiation. Each company will pursue appropriate growth opportunities and execute strategic plans best suited to address the distinct market trends and opportunities for its business. ABVC will continue its clinical-stage drug development in ophthalmology, CNS, and oncology, and the Company will continue pursuing its growth as a nutraceutical and functional supplement CRDMO platform.

Dr. T.S. Jiang, Eugene Jiang, and Uttam Patil, all of whom will be either an ABVC director or executive officer will serve on the Company's board or be an executive officer. Each will allocate their time and responsibilities using their best business judgement and in dialogue with the separate board of directors for each company. The boards of directors of ABVC and the Company will owe fiduciary duties to their respective shareholder bases, with the ABVC Board focusing on matters specific to ABVC, and the Board focusing on matters specific to the Company. See "The Spin-Off—Reasons for the Spin-Off" for more information.

**Value Creation Through Independence.** As an independent, standalone entity, we will be positioned to highlight and capitalize on our differentiated capabilities in nutraceutical research, development, and manufacturing more effectively. Compared to being a part of ABVC's consolidated structure, we will have greater flexibility to implement our strategic focus, allocate resources, and pursue growth initiatives that are specifically tailored to our core business. The Spin-Off can provide increased visibility to our specialized operations, which may have been overshadowed as part of a broader ABVC organization. By bringing these strengths to the forefront, we have the potential to better show our intrinsic value, enhance recognition among investors, customers, and strategic partners, and better articulate the value of our nutraceutical platform. The greater clarity and focus may drive stronger market positioning, and the creation of long-term, sustainable shareholder value.

**Increased Capital Flexibility and Financing Opportunities.** The Spin-Off will provide us with the ability to independently access capital markets and pursue financing activities that are specifically designed to support our unique business model and growth objectives. The Company will no longer be required to compete with ABVC's pharmaceutical pipeline or other business segments for the allocation of financial resources, enabling it to prioritize capital deployment in areas that directly advance our nutraceutical research, development, and manufacturing initiatives. The Spin-Off is expected to create greater efficiency in capital raising efforts, as potential investors and financing partners will be able to evaluate and support us on the basis of our own performance, prospects, and strategic vision, rather than as a component of ABVC. By tailoring our financing approach to our operational needs and market opportunities, we will enhance our financial flexibility, strengthen our capacity to invest in BioKey specific innovation, and improve our ability to respond to evolving industry dynamics. Ultimately, this direct access to capital and more focused financial strategy may contribute to the acceleration of growth, increased competitiveness, and the generation of long-term value for shareholders.

**Enhanced Management Alignment and Talent Retention.** Following the Spin-Off, the Company will establish its own dedicated management team and board of directors, both of which will be accountable for overseeing the company's operations, strategy, and long-term performance. Our leadership will be able to focus on advancing the company's nutraceutical research, development, and manufacturing platform. This new governance structure will incorporate equity-based incentive programs that are directly tied to our financial and operational results, thereby aligning management's interests and those of our shareholders. This alignment is expected to enhance decision-making, drive performance, and instill a stronger sense of ownership across the leadership team. The ability to offer performance-based equity incentives specific to our business is anticipated to serve as a tool for attracting and retaining skilled executives, scientists, and industry professionals who can be critical to our success. We believe that these structural changes position the Company to foster a culture of accountability, innovation, and long-term value creation.

**Compelling Market Opportunity in a Rapidly Expanding Sector.** The global nutraceuticals market represents a growing opportunity, with industry projections estimating expansion from approximately $112 billion in 2022 to more than $167 billion by 2030.<sup>1011</sup> We believe we are positioned to capitalize on these favorable market trends because of our specialization in proprietary botanical extracts—such as Maitake and Polygala. Additionally, our cGMP-certified manufacturing platform provides the Company with a competitive advantage in ensuring that we capitalize on this projected growth. Together, these capabilities allow us not only to participate in the growth of the nutraceutical sector but also to carve out a distinct position within it by offering research and manufacturing solutions. As the market continues to expand and mature, the company's unique abilities are expected to translate into enhanced competitiveness, deeper market penetration, and long-term value creation for shareholders.

In determining whether to effect the Spin-Off, ABVC considered the costs and risks associated with the transaction, including the costs associated with preparing SpinCo to become an independent company, the risk of volatility in our stock price immediately following the Spin-Off due to sales by ABVCs shareholders whose investment objectives may not be met by our Ordinary Shares, the time it may take for us to attract our optimal shareholder base, the possibility of disruptions in our business as a result of the Spin-Off, the risk that the combined trading prices of our ordinary shares and shares of ABVCs Common Stock after the Spin-Off may drop below the trading price of ABVC Common Stock before the Spin-Off, and the loss of synergies and scale from operating as one company.

ABVC also considered the operational and logistical implications of continuing to share facilities with the Company following the Spin-Off. ABVC and the Company currently operate from the same facility in Fremont, CA, and are expected to continue sharing this facility pursuant to mutually agreed arrangements after the Spin-Off. In evaluating this arrangement, ABVC recognized that the allocation of space, costs, and access to shared facilities could, in certain circumstances, limit its flexibility to fully utilize the headquarters for its own operations or require additional costs if ABVC were to relocate, expand, or obtain separate facilities in the future. ABVC also considered the potential for incremental administrative coordination associated with continued co-location. Notwithstanding these considerations, ABVC determined that the continued sharing of facilities is appropriate in light of its current operational needs and is expected to provide cost efficiencies and operational continuity during and following the transition period. ABVC believes that the shared-facility arrangement may reduce near-term overhead, avoid duplicative infrastructure costs, and allow ABVC to allocate resources more efficiently while maintaining the flexibility to pursue independent facilities as its business scales.

<sup>10</sup> https://www.grandviewresearch.com/industry-analysis/nutraceuticals-market

<sup>11</sup> https://www.fortunebusinessinsights.com/nutraceuticals-market-104051

Notwithstanding these costs and risks, taking into account the factors discussed above, ABVC determined that the Spin-Off provided the best opportunity to achieve the above benefits and enhance shareholder value. ABVC will pay substantially all of the third-party fees, costs, and expenses associated with the Spin-Off incurred before and in connection with the consummation of the Spin-Off, and each of ABVC and the Company generally will bear its own third-party fees, costs, and expenses associated with the Spin-Off incurred after the consummation of the Spin-Off.

**When and How You Will Receive SpinCo Shares**

The Share Distribution will be effected in the following sequential steps. First, this information statement will be filed with, and declared effective by, the SEC as part of the Registration Statement on Form 10. Following the effectiveness of the Registration Statement, this information statement will be made available to holders of ABVC Common Stock. At the time of the filing, ABVC will establish the Record Date for the Share Distribution, which will be the date used to determine which holders of ABVC Common Stock are entitled to receive Ordinary Shares in the Share Distribution. On or prior to the Share Distribution Date, ABVC or SpinCo will instruct VStock Transfer, LLC, in its capacity as distribution agent, to effect the Share Distribution by crediting the applicable Ordinary Shares to the accounts of eligible ABVC shareholders as of the Record Date. The Share Distribution will then become effective as of 11:59 p.m., New York City time, on the Share Distribution Date, at which time the Ordinary Shares will be credited to registered shareholders by direct registration in book-entry form and to "street name" or beneficial shareholders through their respective banks, brokers, or other nominees, in each case as further described below.

ABVC will distribute to its shareholders, as a pro rata dividend, [ ] Ordinary Shares for every share of ABVC Common Stock outstanding as of [ ], 2026, the Record Date of the Share Distribution.

Prior to the Share Distribution, ABVC will deliver approximately [ ] of their Ordinary Shares, which represents [ ]% of our issued and outstanding Ordinary Shares, to the distribution agent. VStock Transfer, LLC, will serve both as distribution agent in connection with the Share Distribution and the transfer agent and registrar for our Ordinary Shares.

If you own ABVC Common Stock as of the close of business on [ ], 2026, Ordinary Shares will be issued to your account as follows:

**Registered shareholders.** If you own your ABVC Common Stock directly through ABVCs transfer agent, you are a registered shareholder. In this case, the distribution agent will credit the shares, rounded up to the next whole share, of our Ordinary Shares you receive in the Share Distribution by way of direct registration in book-entry form to a new account with our transfer agent. Registration in book-entry form refers to a method of recording share ownership where no physical share certificates are issued to shareholders, as is the case in the Share Distribution. You will be able to access information regarding your book-entry account for SpinCo shares through VStock Transfer, LLC by calling 212-828-8436.

Commencing on or shortly after the Share Distribution Date, the distribution agent will mail to you an account statement that indicates the number of whole Ordinary Shares that have been registered in book-entry form in your name. We expect it will take the distribution agent up to two weeks after the Share Distribution Date to complete the distribution of our Ordinary Shares and mail statements of holding to all registered shareholders.

**"Street name" or beneficial shareholders**. If you own your ABVC Common Stock beneficially through a bank, broker, or other nominee, the bank, broker, or other nominee holds the shares in "street name" and records your ownership on its books. In this case, your bank, broker, or other nominee will credit your account with the whole Ordinary Shares that you receive in the Share Distribution on or shortly after the Share Distribution Date. We encourage you to contact your bank, broker, or other nominee if you have any questions concerning the mechanics of having shares held in "street name."

If you sell any of your ABVC Common Stock on or before the Share Distribution Date, the buyer of those shares may in some circumstances be entitled to receive our Ordinary Shares of to be distributed in respect of the ABVC Common Stock you sold. See "*The Spin-Off—Trading Prior to the Share Distribution Date*" for more information.

We are not asking ABVC shareholders to take any action in connection with the Spin-Off. We are not asking you for a proxy and request that you not send us a proxy. We are also not asking you to make any payment or surrender or exchange any of your ABVC Common Stock for our Ordinary Shares. The outstanding number of shares of ABVC Common Stock will not change as a result of the Spin-Off.

**Treatment of Fractional Shares**

The distribution agent will not distribute any fractional Ordinary Shares in connection with the Spin-Off. Instead, the distribution agent will round up any fractional shares to the next whole number of shares at the time of the distribution of shares of the Spin-Off. See "*How will our Ordinary Shares trade?*" for additional information regarding "when-issued" trading.

**Material U.S. Federal Income Tax Consequences of the Spin-Off**

The following is a summary of certain material U.S. federal income tax consequences of the Spin-Off to the ABVC shareholders. This discussion is not a complete analysis of all potential U.S. federal income tax consequences relating thereto and does not address (i) the potential application of the Medicare contribution tax on net investment income, (ii) the alternative minimum tax, (iii) any estate or gift tax consequences, or (iv) any tax consequences arising under any state, local, or non-U.S. tax laws, or any other U.S. federal tax laws. This discussion is based on the Internal Revenue Code of 1986, as amended (which we refer to as the "**Code**"), applicable Treasury Regulations promulgated under the Code (which we refer to as "**Treasury Regulations**"), published rulings and administrative pronouncements of the Internal Revenue Service (which we refer to as the "**IRS**"), and judicial decisions, all as in effect as of the date of this Information Statement. These authorities are subject to differing interpretations and may change, possibly retroactively, resulting in U.S. federal income tax consequences different from those discussed below. We have not requested a ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and there can be no assurance that the IRS or a court will agree with such statements and conclusions.

This discussion is limited to ABVC shareholders who will be receiving Ordinary Shares in the Spin-Off, and will be holding shares of our Ordinary Shares as a "capital asset", within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all of the U.S. federal income tax consequences that may be relevant to a particular holder in light of such holder's particular circumstances. This discussion also does not consider any specific facts or circumstances that may be relevant to holders subject to special rules under the U.S. federal income tax laws, including:

● certain former citizens or long-term residents of the United States;

● partnerships or other entities or arrangements treated as partnerships, pass-throughs, or disregarded entities for U.S. federal income tax purposes (and investors therein);

● "controlled foreign corporations";

● "passive foreign investment companies";

● corporations that accumulate earnings to avoid U.S. federal income tax;

● banks, financial institutions, investment funds, insurance companies, brokers, dealers, or traders in securities;

● tax-exempt organizations or governmental organizations;

● persons deemed to be selling shares of ABVC Common Stock, as the case may be, or our Ordinary Shares under the constructive sale provisions of the Code;

● persons who hold or receive shares of ABVC Common Stock, as the case may be, or our Ordinary Shares pursuant to the exercise of an employee stock option or otherwise as compensation;

● tax-qualified retirement plans;

● persons that own, or have owned, actually or constructively, more than 5% of the outstanding shares of ABVC Common Stock, as the case may be, or our Ordinary Shares;

● "qualified foreign pension funds" (as defined in Section 897(l)(2) of the Code) and entities all of the interests of which are held by qualified foreign pension funds;

● persons who have elected to mark securities to market;

● persons holding shares of ABVC Common Stock, as the case may be, or our Ordinary Shares as part of a hedging or conversion transaction or straddle, or a constructive sale, or other risk reduction strategy or other integrated investment; and

● except to the extent explicitly discussed below, non-U.S. holders (as defined below).

If an entity or arrangement that is classified as a partnership for U.S. federal income tax purposes receives our Ordinary Shares in the Spin-Off, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership. Partnerships receiving Ordinary Shares and the partners in such partnerships are urged to consult with their tax advisors about the particular U.S. federal income tax consequences to them of receiving Ordinary Shares in the Spin-Off.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. ABVC SHAREHOLDERS SHOULD CONSULT WITH THEIR TAX ADVISORS REGARDING THE PARTICULAR U.S. FEDERAL INCOME TAX CONSEQUENCES TO THEM OF THE SPIN-OFF AND ACQUIRING, OWNING, AND DISPOSING OF SHARES OF OUR ORDINARY SHARES, AS WELL AS ANY TAX CONSEQUENCES ARISING UNDER ANY OTHER U.S. FEDERAL TAX LAWS AND ANY STATE, LOCAL, OR NON-U.S. TAX LAWS.

**Definitions of U.S. Holder and Non-U.S. Holder**

For purposes of this discussion, a non-U.S. holder is any beneficial owner of shares of ABVC Common Stock receiving Ordinary Shares in the Spin-Off that is not a "U.S. holder" or a partnership (including any entity or arrangement treated as a partnership) for U.S. federal income tax purposes. A "U.S. holder" is any person that, for U.S. federal income tax purposes, is or is treated as any of the following:

● an individual who is a citizen or resident of the United States;

● a corporation (or entity treated as a corporation for U.S. federal income tax purposes) created or organized under the laws of the United States, any state thereof or the District of Columbia;

● an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

● a trust (i) whose administration is subject to the primary supervision of a U.S. court and which has one or more U.S. persons (within the meaning of Section 7701(a)(30) of the Code) who have the authority to control all substantial decisions of the trust, or (ii) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person (within the meaning of Section 7701(a)(30) of the Code).

**Tax Classification of the Spin-Off in General**

For U.S. federal income tax purposes, the Spin-Off will not be eligible for treatment as a tax-deferred distribution by ABVC with respect to ABVC Common Stock. Accordingly, the Spin-Off will generally be treated as a fully taxable transaction for U.S. federal income tax purposes. The discussion below describes the U.S. federal income tax consequences to a U.S. holder of ABVC Common Stock upon the receipt of Ordinary Shares in the Spin-Off.

Although ABVC will ascribe a value to our Ordinary Shares distributed in the Spin-Off, this valuation is not binding on the IRS or any other taxing authority. These taxing authorities could ascribe a higher valuation to the distributed Ordinary Shares, particularly if, following the Spin-Off, those Ordinary Shares trade at prices significantly above the value ascribed to those shares by ABVC. Such a higher valuation may affect the Spin-Off distribution amount and thus the U.S. federal income tax consequences of the Spin-Off to ABVC shareholders.

ABVC will be required to recognize any gain with respect to our Ordinary Shares that it distributes in the Spin-Off equal to the fair market value of our Ordinary Shares in excess of ABVCs adjusted tax basis in our Ordinary Shares.

**Tax Treatment of the Spin-Off to U.S. Holders**

The following discussion describes the U.S. federal income tax consequences to a ABVC shareholder who is a U.S. holder in connection with the receipt of Ordinary Shares in the Spin-Off.

The Spin-Off is expected to be a taxable distribution for U.S. federal income tax purposes. Accordingly, each ABVC shareholder would generally be treated as receiving a taxable distribution equal to the fair market value of our Ordinary Shares (determined at the time of the Spin-Off). Such distribution would be treated as a taxable dividend to the extent of such ABVC shareholders ratable share of ABVCs current or accumulated earnings and profits (as determined for U.S. federal income tax purposes). To the extent the value of the distribution exceeds the amount of such earnings and profits, such excess will be treated first, as reducing such ABVCs adjusted basis in each of its shares of ABVC Common Stock, as the case may be, in respect of which such distribution was made, and second, to the extent it exceeds such adjusted basis, as capital gain from the sale or exchange of such shares of ABVC Common Stock, as the case may be.

To the extent that any portion of the Spin-Off distribution is treated as a dividend, corporate U.S. holders could be eligible for dividend-received deductions, and non-corporate U.S. holders could qualify for reduced rates applicable to qualified dividend income, assuming in each case, that a minimum holding period and certain other generally applicable requirements are satisfied. Additionally, to the extent that the distribution of Ordinary Shares in the Spin-Off constitutes an "extraordinary dividend" within the meaning of Section 1059 of the Code, special rules may apply.

A U.S. holder's tax basis in shares of our Ordinary Shares received in the Spin-Off generally will equal the fair market value of such Ordinary Shares on the date of the Spin-Off, and the holding period for such Ordinary Shares will begin on the day after the Distribution Date.

ABVC shareholders should consult with their tax advisors regarding the appropriate U.S. federal income tax treatment of the Spin-Off and possible applicability and effects of the extraordinary dividend provisions.

**Information Reporting and Backup Withholding**

In general, information reporting requirements may apply to dividends, sales proceeds, or other amounts paid to U.S. holders and non-U.S. holders, unless an exemption applies. These information reporting requirements may apply even if no withholding was required (because the distributions were effectively connected with a non-U.S. holder's conduct of a U.S. trade or business, or withholding was eliminated by an applicable income tax treaty). Backup withholding tax may apply to amounts subject to reporting unless a U.S. holder provides proof of an applicable exemption or a correct taxpayer identification number, and otherwise complies with the requirements of the backup withholding rules. Backup withholding generally will not apply to amounts paid to a non-U.S. holder, provided that the non-U.S. holder furnishes the required certification for its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E, or IRS Form W-8ECI, or certain other requirements are met.

Backup withholding is not an additional tax. If any amount is withheld under the backup withholding rules, a non-U.S. holder should consult with a U.S. tax advisor regarding the possibility of and procedure for obtaining a refund or a credit against such non-U.S. holder's U.S. federal income tax liability, if any.

**Certain U.S. Federal Income Tax Considerations for Non-U.S. Holders**

Subject to the discussion above regarding backup withholding, and the discussions below regarding effectively connected income and Sections 1471 through 1474 of the Code and the Treasury Regulations promulgated thereunder (which we refer to as "**FATCA**"), dividends paid to a non-U.S. holder generally will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends, or such lower rate specified by an applicable income tax treaty. To receive the benefit of a reduced treaty rate, a non-U.S. holder must furnish to ABVC or the Distribution Agent a valid IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) certifying such non-U.S. holder's qualification for the reduced rate. This certification must be provided to ABVC or the Distribution Agent before the payment of dividends and must be updated periodically. If a non-U.S. holder holds shares of ABVC Common Stock through a financial institution or other agent acting on such non-U.S. holder's behalf, such non-U.S. holder will be required to provide appropriate documentation to such agent, which will then be required to provide certification to ABVC or the Distribution Agent, either directly or through other intermediaries.

Non-U.S. holders that do not provide the required certification on a timely basis, but that qualify for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.

If a non-U.S. holder holds shares of ABVC Common Stock in connection with the conduct of a trade or business in the United States, and dividends paid on such shares of ABVC Common Stock are effectively connected with such non-U.S. holder's U.S. trade or business (and if required by an applicable tax treaty, are attributable to such non-U.S. holder's permanent establishment in the United States), such non-U.S. holder generally will be exempt from U.S. federal withholding tax. To claim the exemption, such non-U.S. holder generally must furnish a valid IRS Form W-8ECI (or applicable successor form) to the applicable withholding agent. However, any such effectively connected dividends paid on shares of ABVC Common Stock, as the case may be, generally will be subject to U.S. federal income tax on a net income basis at the regular U.S. federal income tax rates in the same manner as if such holder was a resident of the United States. A non-U.S. holder that is a foreign corporation also may be subject to an additional branch profits tax equal to 30% (or such lower rate specified by an applicable income tax treaty) of its effectively connected earnings and profits for the taxable year, as adjusted for certain items. Non-U.S. holders should consult with their tax advisors regarding any applicable income tax treaties that may provide for different rules.

**Withholding on Foreign Entities**

FATCA imposes a U.S. federal withholding tax of 30% on certain payments made to a "foreign financial institution" (as specially defined under FATCA), unless (i) such foreign financial institution enters into an agreement with the U.S. government to withhold on certain payments and to collect and provide to the U.S. tax authorities substantial information regarding certain U.S. account holders of such foreign financial institution (which includes certain equity and debt holders of such foreign financial institution, as well as certain account holders that are foreign entities with U.S. owners), (ii) if required under an intergovernmental agreement (which we refer to as an "**IGA**") between the United States and another country, such foreign financial institution reports the information described in clause (i) above to its local tax authority, which will exchange such information with the U.S. authorities, or (iii) an exemption applies. FATCA also generally will impose a U.S. federal withholding tax of 30% on certain payments made to a non-financial foreign entity unless such entity provides the withholding agent with a certification identifying certain direct and indirect U.S. owners of such entity, or an exemption applies. Such withholding could apply to a non-U.S. person with respect to the Spin-Off distribution regardless of whether such non-U.S. person is the beneficial owner of ABVC Common Stock, as the case may be, or holds the ABVC Common Stock, as the case may be, for the account of others. FATCA obligations may vary depending on whether the non-U.S. person is a resident of a country with which the United States has signed an IGA. A country that has entered into an IGA with the United States may have incorporated FATCA provisions into its own local law. Such provisions, which can differ from FATCA, are applicable for purposes of determining the proper method for residents of such country to comply with FATCA. FATCA applies to dividends paid on shares of ABVC Common Stock, as the case may be, and, subject to the proposed Treasury Regulations described below, also applies to gross proceeds from sales or other dispositions of shares of ABVC Common Stock, as the case may be.

The U.S. Treasury Department released proposed Treasury Regulations which, if finalized in their present form, would eliminate the federal withholding tax of 30% applicable to the gross proceeds of a disposition of shares of ABVC Common Stock, as the case may be. In its preamble to such proposed Treasury Regulations, the U.S. Treasury Department stated that taxpayers generally may rely on the proposed Treasury Regulations until final regulations are issued. In order to determine if FATCA withholding is required in respect of any holder of shares of ABVC Common Stock, as the case may be, from time to time, we or ABVC may require further information and/or documentation from holders of shares of ABVC Common Stock, as the case may be, including, but not limited to, a valid IRS Form W-8 or any applicable successor form. Under certain circumstances, a non-U.S. holder might be eligible for refunds or credits of amounts withheld under FATCA (which may entail significant administrative burden). ABVC shareholders are encouraged to consult with their tax advisors regarding the possible implications of this legislation on the Spin-Off.

***Results of the Spin-Off***

After the Spin-Off, we will be an independent company. Immediately following the Spin-Off, we expect to have approximately [ ] Ordinary Shares outstanding, based on the number of shares of ABVC Common Stock outstanding on [ ], 2026. The actual number of our Ordinary Shares that ABVC will distribute in the Spin-Off will depend on the actual number of shares of ABVC Common Stock outstanding on the Record Date, which will reflect any issuance of new shares or exercises of outstanding options pursuant to share incentive plans, and any repurchase of ABVC shares on or prior to the Record Date. ABVC Common Stock held by ABVC as treasury shares will not be considered outstanding for purposes of the Share Distribution and will not be entitled to participate in the Share Distribution. The Spin-Off will not affect the outstanding number of ABVC Common Stock or any rights of ABVC shareholders. However, following the Share Distribution, the equity value of ABVC will no longer reflect the value of the business. There can be no assurance that the combined trading prices of the shares of ABVC Common Stock and our Ordinary Shares will equal or exceed what the trading price of ABVC Common Stock would have been in absence of the Spin-Off.

Before the Spin-Off, we intend to enter into a Separation and Distribution Agreement and potentially other agreements with ABVC related to the Spin-Off. These agreements will govern the relationship between us and ABVC up to and after completion of the Spin-Off and allocate between us and ABVC various assets, liabilities, rights, and obligations, including employee benefits, environmental, intellectual property, and tax-related assets and liabilities. We describe these arrangements in greater detail under "*Certain Relationships and Related Party Transactions—Agreements with ABVC*."

***Trading of our Ordinary Shares***

We are currently a wholly owned subsidiary of ABVC. Accordingly, no public market for our Ordinary Shares currently exists, although a "when-issued" market in our Ordinary Shares may develop prior to the Share Distribution. See "*The Spin-Off—Trading Prior to the Share Distribution Date*" below for an explanation of a "when-issued" market. We will apply to list our Ordinary Shares to trade over-the-counter on the OTC Markets under the symbol assigned to us in connection with, and upon completion of, the OTC listing process. Following the Spin-Off, ABVC Common Stock will continue to trade on the Nasdaq Stock Market under the symbol "ABVC".

Neither we nor ABVC can assure you as to the trading price of ABVC Common Stock or our Ordinary Shares after the Spin-Off, or as to whether the combined trading prices of our Ordinary Shares and the ABVC Common Stock after the Spin-Off will equal or exceed the trading prices of ABVC Common Stock prior to the Spin-Off. The trading price of our Ordinary Shares may fluctuate significantly following the Spin-Off.

Our Ordinary Shares distributed to ABVC shareholders will be freely transferable, except for shares received by individuals who are our affiliates. Individuals who may be considered our affiliates after the Spin-Off include individuals who control, are controlled by, or are under common control with us, as those terms generally are interpreted for federal securities law purposes. These individuals may include some or all of our directors and executive officers. Individuals who are our affiliates will be permitted to sell our Ordinary Shares they own only pursuant to an effective registration statement under the Securities Act of 1933, as amended (the "**Securities Act**"), or an exemption from the registration requirements of the Securities Act, such as those afforded by Section 4(a)(1) of the Securities Act or Rule 144 thereunder.

***Trading of our Ordinary Shares***

No public trading market for our Ordinary Shares is expected to exist at the time of the Share Distribution. Trading in our Ordinary Shares will not commence until, and unless, our Ordinary Shares are quoted on the OTC Markets following the Spin-Off. We intend to apply for quotation of our Ordinary Shares on the OTC Markets following the completion of the Spin-Off, but there can be no assurance as to the timing of such quotation or that an active trading market will develop. Until our Ordinary Shares are quoted on the OTC Markets, holders of our Ordinary Shares will not be able to sell or transfer their shares in the public market.

Following the Share Distribution, ABVC Common Stock will continue to trade on the Nasdaq Stock Market under the symbol "ABVC." The Share Distribution will not affect the trading of ABVC Common Stock on Nasdaq.

***Conditions to the Spin-Off***

We expect that the Spin-Off will be effective on the Share Distribution Date, provided that the following conditions shall have been satisfied or waived by ABVC:

● the ABVC Board shall have approved the Reorganization Transactions and Share Distribution and not withdrawn such approval, and shall have declared the dividend of our Ordinary Shares to ABVC shareholders;

● any ancillary agreements contemplated by the Separation and Distribution Agreement shall have been executed by each party to those agreements;

● the Registration Statement on Form 10, of which this information statement is a part, shall be effective and no stop order suspending the effectiveness of the Registration Statement shall be in effect and no proceedings for that purpose shall be pending before or threatened by the SEC;

● the Reorganization Transactions shall have been completed (other than those steps that are expressly contemplated to occur at or after the Share Distribution);

● no order, injunction, or decree issued by any governmental authority of competent jurisdiction or other legal restraint or prohibition preventing consummation of the Share Distribution shall be in effect, and no other event outside the control of ABVC shall have occurred or failed to occur that prevents the consummation of the Share Distribution;

● no other events or developments shall have occurred prior to the Share Distribution that, in the judgment of the ABVC Board, would result in the Share Distribution having a material adverse effect on ABVC or its stockholders;

● prior to the Share Distribution Date, notice of Internet availability of this information statement or this information statement shall have been mailed to the holders of ABVC Common Stock as of the Record Date; and

● certain other conditions set forth in the Separation and Distribution Agreement.

Any of the above conditions may be waived by the ABVCs Board to the extent such waiver is permitted by law. If the ABVC Board waives any condition prior to the effectiveness of the Registration Statement on Form 10, of which this information statement Forms a part, and the result of such waiver is material to ABVC shareholders, we will file an amendment to the Registration Statement on Form 10, of which this information statement forms a part, to revise the disclosure in the information statement accordingly. In the event that ABVC waives a condition after this Registration Statement becomes effective and such waiver is material, we would communicate such change to ABVC shareholders by filing a Form 8-K describing the change.

The fulfillment of the above conditions will not create any obligation on ABVCs part to complete the Spin-Off. We are not aware of any material federal, foreign, or state regulatory requirements with which we must comply, other than SEC rules and regulations, or any material approvals that we must obtain, other than the approval for listing our Ordinary Shares and the SEC's declaration of the effectiveness of the Registration Statement, in connection with the Share Distribution. ABVC may at any time until the Share Distribution decide to abandon the Share Distribution or modify or change the terms of the Share Distribution and we cannot guarantee that any or all of the conditions will be satisfied or waived.

***Reasons for Furnishing this Information Statement***

We are furnishing this information statement solely to provide information to ABVCs shareholders who will receive our Ordinary Shares in the Share Distribution. You should not construe this information statement as an inducement or encouragement to buy, hold, or sell any of our securities or any securities of ABVC. We believe that the information contained in this information statement is accurate as of the date set forth on the cover. Changes to the information contained in this information statement may occur after that date, and neither we nor ABVC undertakes any obligation to update the information except in the normal course of our and ABVCs public disclosure obligations and practices.

**DIVIDEND POLICY**

Subject to the sole discretion of our Board and the considerations discussed below, once the Spin-Off is effective, we do not anticipate paying cash dividends on our Ordinary Shares for the foreseeable future.

The Board's decisions regarding the payment of dividends will depend on consideration of many factors, such as our financial condition, earnings, sufficiency of distributable reserves, opportunities to retain future earnings for use in the operation of our business and to fund future growth, capital requirements, debt service obligations, legal requirements, regulatory constraints, and other factors that the Board deems relevant. See "*Risk Factors—Risks Related to Our Ordinary Shares—Since we do not expect to pay dividends in the foreseeable future, you must rely on the price appreciation of our Ordinary Shares for a return on your investment.*"

**CAPITALIZATION**

The following table sets forth our capitalization as March 31, 2026:

☐ on a historical basis; and <br>☐ on a pro forma basis to reflect the adjustments included in our Unaudited Pro Forma Condensed Consolidated Financial Statements

The information below is not necessarily indicative of what our capitalization would have been had the Spin-Off, distribution, and related transactions been completed as of March 31, 2026. In addition, it is not indicative of our future capitalization.

This table should be read in conjunction with the "Unaudited Pro Forma Condensed Consolidated Financial Statements", "Management's Discussion and Analysis of Financial Condition and Results of Operations", sections of this information statement and our unaudited condensed consolidated financial statements and notes thereto included in the "Index to Consolidated Financial Statements" of this information statement.

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31,<br> 2026 <br> (Unaudited)** | **As of <br> March 31,<br> 2026 <br> (Unaudited)** |
|  | **Historical** | **As<br> Adjusted** |
| Cash, cash equivalents and restricted cash: | $1614 | $|
| Capitalization: |  |  |
| Debt | $7079581 | $|
| Equity: |  |  |
| Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, and 30,000,000 shares issued and outstanding | $3000 | $|
| Additional paid-in capital |  |  |
| Accumulated deficit | (5284602) |  |
| Total shareholders' deficit | $(5281602) | $|
| Total capitalization | $1797979 | $|

---

We have not yet finalized our post-Spin-Off capitalization. Adjusted financial data reflecting our post-Spin-Off capitalization will be included in an amendment to this information statement.

**SELECTED HISTORICAL AND UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA**

The following tables present certain selected historical consolidated financial information as of and for each of the years in the two-year period ended December 31, 2025 and 2024 and for the three months ended March 31, 2026 and 2025. The selected historical consolidated financial data as of December 31, 2025 and 2024 is derived from our historical audited consolidated financial statements included elsewhere in this information statement. The unaudited consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of our management, include all adjustments, consisting of only ordinary recurring adjustments, necessary for a fair statement of the information set forth in this information statement.

The selected historical consolidated financial data presented below should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our historical consolidated financial statements and the accompanying notes thereto included elsewhere in this information statement. For each of the periods presented, our business was wholly owned by ABVC. The financial information included herein may not necessarily reflect our financial position, results of operations, and cash flows in the future or what our financial position, results of operations, and cash flows would have been had we been an independent company during the periods presented. In addition, our historical consolidated financial information does not reflect changes that we expect to experience in the future as a result of our separation from ABVC, including changes in the financing, operations, cost structure, and personnel needs of our business. Further, the historical consolidated financial information includes allocations of certain ABVC corporate expenses. We believe the assumptions and methodologies underlying the allocation of these expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that we would have incurred if we had operated as an independent company or of the costs expected to be incurred in the future.

The following tables also present certain unaudited pro forma condensed consolidated financial information of SpinCo for the three months ended March 31 2026, and the year ended December 31, 2025, and an Unaudited Pro Forma Condensed Consolidated Financial Balance Sheet as of March 31, 2026. The Unaudited Pro Forma Condensed Consolidated Financial Statements are derived from our historical consolidated financial statements included elsewhere in this information statement and are not intended to be a complete presentation of our financial position or results of operations had the transactions contemplated by the Separation and Distribution Agreement and related agreements occurred as of the dates indicated. The Unaudited Pro Forma Condensed Consolidated Financial Statements should be read in conjunction with our "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" and our historical consolidated financial statements and the accompanying notes included elsewhere in this information statement.

The Unaudited Pro Forma Condensed Consolidated Financial Statements of Operations for the three months ended March 31, 2026, and the year ended December 31, 2025, reflect our results as if the Spin-Off and related transactions had occurred as of January 1, 2026. The Unaudited Pro Forma Condensed Consolidated Financial Balance Sheet as of March 31, 2026, reflects our results as if the Spin-Off and related transactions had occurred as of such date. Refer to the "*Unaudited Pro Forma Condensed Consolidated Financial Statements*" for further information about the Spin-Off transactions.

**Selected Historical Statement of Operations Information**

**Selected Balance Sheet Information**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> Year Ended<br> December 31, <br> 2025** | **For the<br> Year Ended<br> December 31,<br> 2024** | **For the<br> Three Months<br> Ended<br> March 31, <br> 2026** | **For the<br> Three Months<br> Ended<br> March 31, <br> 2025** |
|  | | | **(Unaudited)** | **(Unaudited)** |
| **Statement of Operations Data** | | | | |
| Total revenue | $- | $13589 | $- | $- |
| Total operating expenses | $712319 | $764854 | $184230 | $129576 |
| Income from operations |  |  |  |  |
| Total other income (expense) | $(30753) | $(39252) | (23496) | (23410) |
| Net loss | $(743072) | $(791280) | $(207726) | $(152986) |
| **Balance Sheet Data (at period end)** |  |  |  |  |
| Cash, restricted cash and cash equivalents | $2883 | $8145 | $1614 | $6388 |
| Working capital | $(5433889) | $(4760967) | $(5641470) | $(4955099) |
| Total assets | $1880078 | $529448 | $1797979 | $456583 |
| Total liabilities | $6953954 | $4860252 | $7079581 | $4940373 |
| Total deficit | $(5073876) | $(4330804) | $(5281602) | $(4483790) |

---

**UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

The Unaudited Pro Forma Condensed Consolidated Financial Statements of SpinCo consist of the Unaudited Pro Forma Condensed Consolidated Financial Statements of Operations for the three months ended March 31, 2026, and the year ended December 31, 2025, and an Unaudited Pro Forma Condensed Consolidated Financial Balance Sheet as of March 31, 2026. The Unaudited Pro Forma Condensed Consolidated Financial Statements are derived from our historical consolidated financial statements included elsewhere in this information statement and are not intended to be a complete presentation of our financial position or results of operations had the transactions contemplated by the Separation and Distribution Agreement and related agreements occurred as of the dates indicated. The Unaudited Pro Forma Condensed Consolidated Financial Statements should be read in conjunction with our "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" and our historical consolidated financial statements and the accompanying notes included elsewhere in this information statement.

The Unaudited Pro Forma Condensed Consolidated Financial Statements of Operations for the three months ended March 31, 2026, and the year ended December 31, 2025, reflect our results as if the Spin-Off and related transactions described below had occurred as of January 1, 2026. The Unaudited Pro Forma Condensed Consolidated Financial Balance Sheet as of March 31, 2026, reflects our results as if the Spin-Off and related transactions described below had occurred as of such date.

The Unaudited Pro Forma Condensed Consolidated Financial Statements will give effect to the following:

● the contribution by to us of all the assets and liabilities that comprise our business pursuant to the Separation and Distribution Agreement;

● the anticipated post-Share Distribution capital structure, including the issuance of our Ordinary Shares to holders of ABVC Common Stock;

● the impact of, and transactions contemplated by, the Separation and Distribution Agreement, other agreements related to the Share Distribution between us and ABVC and the provisions contained therein; and

● the incremental costs we expect to incur as an autonomous entity.

The Unaudited Pro Forma Condensed Consolidated Financial Statements are subject to the assumptions and adjustments described in the accompanying notes that reflect the expected impacts of events directly attributable to the Spin-Off and that are factually supportable and, for purposes of statements of operations, are expected to have a continuing impact on us. However, these adjustments are subject to change as we and ABVC finalize the terms of the Separation and Distribution Agreement and the other agreements related to the Share Distribution. The Unaudited Pro Forma Condensed Consolidated Financial Statements are provided for illustrative and informational purposes only and are not necessarily indicative of our future results of operations or financial condition as an independent, publicly traded company.

The operating expenses reported in our historical consolidated statements of operations include allocations of certain ABVC costs. These costs include the allocation of all ABVCs corporate costs, shared services, and other related costs that benefit us.

We expect to incur additional recurring costs of being a stand-alone company. The significant assumptions involved in determining our estimates of recurring costs of being a stand-alone public company include:

● costs to perform financial reporting, tax, regulatory compliance, corporate governance, treasury, legal, internal audit, and investor relations activities;

● insurance premiums;

● changes in our overall facility costs; and

● the type and level of other costs expected to be incurred

We currently estimate that we will incur substantial non-recurring costs associated with becoming a stand-alone company within 24 months of the Share Distribution. The accompanying Unaudited Pro Forma Condensed Consolidated Financial Statements of Operations are not adjusted for these estimated expenses as they are also projected amounts based on estimates and would not be factually supportable. These expenses primarily relate to the following:

● recruiting costs associated with hiring key senior management personnel new to our Company;

● costs related to establishing our new brand in the marketplace; and

● costs of retention bonuses.

Due to the scope and complexity of these activities, the amount of these costs could increase or decrease materially, and the timing of incurrence could change.

The accompanying Pro Forma Consolidated Statements of Operations are also not adjusted for any potential dividends SpinCo may pay in the future should the Board determine to declare any such dividends.

**BIOKEY (CAYMAN), INC AND SUBSIDIARY**

**UNAUDITED PRO FORMA CONDENSED STATEMENTS OF OPERATIONS**

**THREE MONTHS ENDED MARCH 31, 2026**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |<br>**Historical** | **Pro Forma**<br>**Adjustments**<br>**Separation (a)** | **Pro Forma**<br>**Adjustments**<br>**Stand Alone (b)** |<br>**Pro Forma** |
| **Revenues** | $- | $- | $- | $- |
| **Cost of revenues** | - | - | - | - |
| **Gross profit** |  |  |  |  |
| **Operating expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 184230 | 25000 |  | 209230 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 184230 | 25000 | - | 209230 |
| **Loss from operations** | (184230) | (25000) | - | (209230) |
| **Other income (expense)** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense | (41496) |  |  | (41496) |
| &nbsp;&nbsp;&nbsp;Operating sublease income | 18000 |  |  | 18000 |
| &nbsp;&nbsp;&nbsp;Other income, net | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense | (23496) | - | - | (23496) |
| **Loss before provision for income tax** | (207726) | **(25000)** | **-** | (232726) |
| Provision for income tax expense (benefit) | - | - | - | - |
| **Net income (Loss)** | $(207726) | $**(25000)** | **-** | $(232726) |
| Net loss per share attributable to common stockholders |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted (c) | $(0.01) | $(0.00) | $- | $(0.01) |
| Weighted average number of common shares outstanding |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted (c) | 30000000 | 30000000 | 30000000 | 30000000 |

---

**BIOKEY (CAYMAN), INC AND SUBSIDIARY**

**UNAUDITED PRO FORMA CONDENSED STATEMENTS OF OPERATIONS**

**YEAR ENDED DECEMBER 31, 2025**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |<br>**Historical** | **Pro Forma**<br>**Adjustments**<br>**Separation (a)** | **Pro Forma**<br>**Adjustments**<br>**Stand Alone (b)** |<br>**Pro Forma** |
| **Revenues** | $- | $- | $- | $- |
| **Cost of revenues** | - | - | - | - |
| **Gross profit** |  |  |  |  |
| **Operating expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 712319 | 100000 |  | 812319 |
| &nbsp;&nbsp;&nbsp;Stock based compensation | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 712319 | 100000 | - | 812319 |
| **Loss from operations** | (712319) | (100000) | - | (812319) |
| **Other income (expense)** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense | (153891) |  |  | (153891) |
| &nbsp;&nbsp;&nbsp;Operating sublease income | 155796 |  |  | 155796 |
| &nbsp;&nbsp;&nbsp;Other income, net | (32658) | - | - | (32658) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense | (30753) | - | - | (30753) |
| **Loss before provision for income tax** | **(743072)** | **(100000)** | **-** | **(843072)** |
| Provision for income tax expense (benefit) | - | - | - | - |
| **Net Loss** | $**(743072)** | $**(100000)** | $**-** | $**(843072)** |
| Net loss per share attributable to common stockholders |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted (c) | $(0.02) | $(0.00) | $- | $(0.03) |
| Weighted average number of common shares outstanding |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted (c) | 30000000 | 30000000 | 30000000 | 30000000 |

---

**BIOKEY (CAYMAN), INC AND SUBSIDIARY**

**UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET**

**AS OF MARCH 31, 2026**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |<br>**Historical** | **Pro Forma**<br>**Adjustments**<br>**Separation** | **Pro Forma**<br>**Adjustments**<br>**Stand Alone** |<br>**Pro Forma** |
| **ASSETS** | | | | |
| **Current Assets** | | | | |
| Cash and cash equivalents | $1614 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $1614 |
| Due from related parties | 12558 |  |  | 12558 |
| Prepaid expense and other current assets | 41987 | - | - | 41987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Assets** | 56159 | **-** | **-** | 56159 |
| Property and equipment, net | 75224 |  |  | 75224 |
| Operating lease right-of-use assets | 1653263 |  |  | 1653263 |
| Security Deposits | 13333 | - | - | 13333 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Assets** | $1797979 | $**-** | $**-** | $1797979 |
| **LIABILITIES AND EQUITY** |  |  |  |  |
| **Current Liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | $327030 | $- | $- | $327030 |
| &nbsp;&nbsp;&nbsp;Contract Liabilities (Advance from customers) | 12600 |  |  | 12600 |
| &nbsp;&nbsp;&nbsp;Operating lease liability – current portion | 287601 |  |  | 287601 |
| &nbsp;&nbsp;&nbsp;Due to related parties | 4445056 |  |  | 4445056 |
| &nbsp;&nbsp;&nbsp;Accrued interest payable - related parties | 625342 | - | - | 625342 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Liabilities** | 5697629 | **-** | **-** | 5697629 |
| **Noncurrent Liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liability – noncurrent portion | 1381952 | - | - | 1381952 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Liabilities** | 7079581 | **-** | **-** | 7079581 |
| **Equity** |  |  |  |  |
| Common Stock (Par $0.001) | 3000 |  |  | 3000 |
| Accumulated deficit | (5284602) | - | - | (5284602) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Stockholders' deficit** | (5281602) | **-** | **-** | (5281602) |
| **Total Liabilities and Equity** | $1797979 | $**-** | $**-** | $1797979 |

---

**Notes to Unaudited Pro Forma Consolidated Financial Statements**

For further information regarding the historical consolidated financial statements, please refer to the audited consolidated financial statements included in this information statement. The Unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2026, Unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2026, and for the year ended December 31, 2025, include adjustments related to the following:

(a) As an independent public
 company following the Spin-Off from ABVC, the Company expects to incur additional costs associated with operating as a standalone
 reporting entity, including expenses related to financial reporting and regulatory compliance, board of directors' compensation
 and expenses, accounting, auditing, tax, legal, insurance, information technology, human resources, investor relations, and other
 general and administrative functions. The Company's historical and interim general and administrative expenses are reflected
 in the consolidated financial statements and related notes included elsewhere in this filing. The Company expects its general and
 administrative expenses to increase following the Spin-Off as it establishes independent public company infrastructure and governance
 functions.

(b) The number of BioKey Cayman
 shares used to compute basic income per ordinary share for the three months ended March 31, 2026, and year ended December 31, 2025,
 is based on the number of Ordinary Shares which are expected to be outstanding upon completion of the distribution. We have assumed
 the number of outstanding Ordinary Shares based on the number of ABVC Common Stock outstanding as of March 31, 2026, and an assumed
 pro-rata distribution ratio of one-one Ordinary Share of BioKey Cayman for each share of ABVC Common Stock and the impact of the
 Share Purchase Agreement described in Note (d) below. The actual number of Ordinary Shares outstanding upon completion of the Distribution
 may be different from this estimated amount.

(c) The number of shares used
 to compute diluted income per ordinary share is the same as the Ordinary Shares of BioKey Cayman as described in Note (b) above,
 due to a net loss reported in the unaudited pro forma consolidated statement of earnings for the three months ended March 31, 2026,
 and for the year ended December 31, 2025.

(d) Reflect the assumption
 that there will be [ ] Ordinary Shares of BioKey Cayman issued or outstanding effective upon spin off in connection with
 the Separation and Distribution Agreement to be entered into between BioKey Cayman and ABVC.

**BUSINESS**

BioKey (Cayman), Inc. is a nutraceutical and functional ingredient company focused on the research, development, and commercialization of clinically supported botanical extracts and dietary supplement formulations. The Company also operates as the core Contract Research, Development, and Manufacturing Organization (CRO/CDMO) within the ABVC BioPharma group (the "**ABVC Group**"), providing formulation support, pilot-scale production, analytical testing, and manufacturing coordination for plant-based wellness products.

BioKey Cayman was established through an internal restructuring in 2024–2025 to consolidate the nutraceutical assets and CRO/CDMO capabilities of BK California. The Company's operations span R&D laboratories, pilot manufacturing facilities, and packaging and warehousing capabilities located in Fremont, California and in Taiwan through qualified contract manufacturers.

BioKey Cayman is an exempted company incorporated in the Cayman Islands. On May 10, 2025, the Company entered into the STA with ABVC and BK California, pursuant to which the Company acquired 100% of the equity interests of BioKey, Inc., a California-based pharmaceutical manufacturing and development company, for $100.

On February 8, 2019, ABVC BioPharma, Inc. acquired BioKey, Inc. through a stock-for-stock transaction, whereby ABVC issued 30,000,000 shares of ABVC Common Stock, valued at $2 per share, to the shareholders of BioKey, Inc. As a result, BioKey became a wholly owned subsidiary of ABVC. The acquisition was disclosed in the Form S-4 registration statement (File Number 333-226285) filed with the U.S. Securities and Exchange Commission.

Following the 2025 reorganization under BioKey Cayman, the Company has been restructured into a fully integrated CRO/CDMO platform, offering both research and manufacturing services under one roof. The Company's expanded capabilities include:

● Contract Research Services (CRO)

● Active Pharmaceutical Ingredient (API) Analysis and Characterization

● Drug Formulation and Analytical Method Development

● Clinical trial material production under cGMP Conditions

● FDA-compliant Documentation and Regulatory Filing Support

The Company's principal operations are conducted through its Fremont, California facility, which houses its cGMP-certified manufacturing site, formulation development labs, and newly added CRO capabilities.

**Corporate Structure** 

The following diagram shows our organizational structure immediately before the completion of the Spin-Off:

![](ea029154601_ex99-1img1.jpg)

After the Spin-Off, the Company will be a stand-alone entity with BioKey, Inc. ("**BK California**") as its sole subsidiary. The following diagram shows our organizational structure immediately following the completion of the Spin-Off:

![](ea029154601_ex99-1img2.jpg)

**Products & Technologies**

BioKey operates as a contract development and manufacturing organization ("**CDMO**") focused on specialty pharmaceutical products, providing integrated services that support product development and clinical advancement. The Company's offerings include pre-formulation and formulation development, analytical services including drug substance and drug product stability studies, pilot-scale manufacturing, clinical supply manufacturing and logistics support, and regulatory assistance related to investigational new drug ("**IND**"), new drug application ("**NDA**"), and abbreviated new drug application ("**ANDA**") submissions, in each case in support of customer-sponsored development programs.

**Oral Release Technologies**

BioKey has developed and applied oral drug delivery and release technologies designed to support the formulation of solid dosage forms with enhanced water solubility and liquid dosage forms utilizing liquid-filled soft gel systems with multi-layer coatings. The Company's controlled oral release capabilities include pH-modulated and swollen hydrogel systems, membrane-controlled and bioerodible release systems, microencapsulated and pulsatile release systems, osmotic-controlled release systems, solubility-modulating, and delayed-release hydrogel platforms, stabilized encapsulated drug release systems, granulated hydrogel matrix systems, microporous matrix systems, and dual-layer stabilized controlled release systems. These technologies are applied, as appropriate, to support customer-sponsored development programs by tailoring release profiles, stability characteristics, and performance attributes to specific formulation and therapeutic objectives.

**Consumer Products** 

BioKey is developing plant-based consumer products intended for distribution in the United States, Canada, and certain Asian markets, and has implemented manufacturing processes designed to meet applicable regulatory requirements governing product safety, labeling, and quality. The Company has developed methods for manufacturing consumer products at its facilities that are intended to comply with U.S. Food and Drug Administration ("**FDA**") requirements and other applicable regulatory standards, including the use of appropriate safeguards, instructions for use, and quality controls required for products marketed for consumer use in these jurisdictions.

**Maitake Mushroom Supplements**

BioKey is in advanced stages of developing Maitake mushroom–based tablet and beverage formulations for international customers, utilizing its proprietary formulation and manufacturing processes. Maitake mushrooms contain naturally occurring beta-glucans and other bioactive compounds that have been the subject of academic and preclinical research evaluating their potential nutritional and functional properties. While various studies conducted by third parties have explored the biological characteristics of Maitake-derived compounds, BioKey's products are being developed as dietary supplements and are not intended to diagnose, treat, cure, or prevent any disease, and any commercialization is subject to applicable regulatory requirements in the jurisdictions in which such products may be marketed. Research literature suggests that Maitake β-glucans may support immune function and metabolic wellness. These observations are based on academic studies<sup>12</sup>, and BioKey does not make any therapeutic claims regarding disease treatment. All Maitake products currently are marketed solely as dietary supplements.

The Company's activities are currently focused on two active programs: (1) a Maitake β-glucan dietary supplement (BLEX-404) and (2) PDC-1421, a botanical product under development for sleep and mood support.

*BLEX-404*

BLEX-404 (Maitake β-glucan extract) is a standardized bioactive polysaccharide extract derived from Grifola frondosa (Maitake mushroom). BLEX-404 is positioned as an immune-support functional ingredient and is used in dietary supplements currently being introduced in Asia and North America.

*PDC-1421*

PDC-1421 (Polygala tenuifolia extract) is a botanical extract derived from *Radix Polygala*, a plant traditionally used in East Asian herbal practices. The product is being developed as a dietary supplement ingredient intended for mood and sleep-support applications. Pre-clinical literature and third-party academic studies have evaluated Polygala-derived compounds for their neuroactive and adaptogenic properties. BioKey Cayman's activities related to PDC-1421 are currently limited to formulation development, stability testing, and evaluation of potential functional food and dietary supplement formats. PDC-1421 has not been approved by the FDA for the treatment or prevention of any disease, and any future commercialization will be subject to applicable dietary supplement and food regulatory requirements.

**Product Development Status**

BioKey Cayman's current development activities focus on (i) BLEX-404, a Maitake β-glucan dietary supplement, and (ii) PDC-1421, a botanical ingredient under evaluation for functional food and dietary supplement use. Both programs are in the formulation optimization and early commercialization support stage.

**Regulatory Status**

BLEX-404 and PDC-1421 are being developed as dietary supplements or functional food ingredients. They are not regulated as pharmaceutical drugs and are not subject to FDA approval requirements applicable to drugs. Any marketing is subject to dietary supplement, food safety, labeling, and registration requirements in applicable jurisdictions.

**Scientific and Clinical Support**

Scientific support for both programs is based on third-party academic literature, historical use, and internal formulation and stability data. BioKey Cayman does not conduct sponsor-initiated clinical trials for these products.

**Manufacturing and Supply Chain**

Pilot-scale manufacturing, formulation, and testing are conducted at the Company's Fremont, California facility. Commercial-scale manufacturing is performed through qualified contract manufacturers in Asia and the United States.

<sup>12</sup> https://www.sciencedirect.com/science/article/abs/pii/S0141813025103036

**Commercialization and Market Strategy**

Commercialization efforts focus on business-to-business supply to supplement brands, ingredient distributors, and affiliated entities, primarily in Asia and North America.

**Revenues**

Revenues generated to date relate primarily to ingredient supply, formulation services, and CRO/CDMO services. Product revenues are not material at this stage.

**Risks and Uncertainties**

Key risks include regulatory changes affecting dietary supplements, raw material availability, and customer adoption of new botanical formulations.

**Services** 

BioKey Cayman provides CRO/CDMO services supporting nutraceutical and botanical product development, including formulation optimization, extraction technology development, stability testing, analytical method development, pilot manufacturing, packaging, labeling, and regulatory documentation for dietary supplement registration.

In addition, the Company provides limited FDA-related support services by assisting clients with documentation for their own investigational new drug ("**IND**") submissions. BioKey Cayman does not conduct pharmaceutical drug development itself but may support sponsor-led clinical programs by preparing manufacturing records, analytical data, and related regulatory materials.

The Company's integrated service platform covers pre-formulation and formulation development for oral solid and liquid dosage forms, clinical-supply manufacturing under current Good Manufacturing Practice ("**cGMP**") guidelines, and GMP analytical and quality-control testing to support product release and stability programs. BioKey Cayman also offers regulatory support services, including maintenance of sponsor-provided IND documentation and coordination of investigational product logistics for client clinical studies.

Product Development

BioKey operates as a contract development and manufacturing organization ("**CDMO**") providing product development and clinical supply services for pharmaceutical, nutraceutical, botanical, and biologic development programs, with manufacturing conducted under current Good Manufacturing Practice ("**cGMP**") guidelines. The Company's product development services encompass pre-formulation, formulation, process development, analytical method development, stability studies conducted in accordance with International Council for Harmonisation ("**ICH**") guidelines, and cGMP manufacturing of drug substance and drug product. BioKey's operations are based in Fremont, California, a recognized biopharmaceutical hub in the United States, and since 2018 the Company has manufactured and delivered multiple development and clinical supply projects for third-party customers.

**Formulation and Pre-Formulation** 

BioKey provides pre-formulation and formulation development services designed to support the development of stable and bioavailable pharmaceutical, nutraceutical, and botanical products in oral solid dosage forms, including tablets and capsules, as well as liquid formulations. Pre-formulation activities include physicochemical characterization of active ingredients, excipient compatibility assessments, and powder and granular characterization to inform formulation design and manufacturability. Building on these studies, the Company conducts formulation development to optimize dosage form performance, stability, and scalability, generating data to support downstream process development, manufacturing, and regulatory submissions.

The Company has formulation development capabilities for non-sterile solutions, semi-solid dosage forms, including gels, creams, and ointments, and solid dosage forms, including powders, tablets, and capsules, which are developed in its research and development laboratories and manufactured in its cGMP pilot plant. The Company's equipment generally supports batch sizes of up to approximately 25 kilograms, with the ability to accommodate smaller batches for early-stage development studies and, in certain cases, larger batches depending on product requirements. BioKey has experience in the development of botanical and nutritional supplement products, including the capability to produce such products in a food-grade pilot plant, and offers packaging services for delivery systems such as metered-dose pumps, pouches, and bottles. The Company also maintains cGMP-compliant storage for bulk, unlabeled, and clinically labeled materials and, upon customer instruction, can prepare, package, label, and ship clinical supplies in accordance with customer-provided protocols and applicable regulatory requirements.

The Company provides additional development and manufacturing support services for early-stage clinical programs, including formulation and process development for investigational products intended for Phase 1 and Phase 2 studies, as well as the manufacture of such products in its cGMP pilot plant. Where a formulation or manufacturing process has been previously developed by a customer, the Company can support technology transfer and implementation of the process at its facilities. BioKey works collaboratively with customers to establish raw material, in-process, and finished product testing methods and specifications, and to prepare master batch records and master packaging records required for compliant manufacturing and filling operations. The Company also provides packaging and labeling services for bulk materials in accordance with clinical trial protocols and applicable regulatory requirements.

**Analytical Services** 

BioKey operates a cGMP-compliant analytical laboratory that supports the development, manufacturing, release, and stability testing of clinical and research materials. The Company's analytical services include analytical method development, validation, and method transfer in support of drug development programs from early-stage through later-stage clinical development. BioKey applies spectroscopic, chromatographic, and physicochemical techniques to analyze small-molecule active pharmaceutical ingredients, botanical products, and nutraceuticals, generating data to support product quality, consistency, and compliance with applicable regulatory and quality standards.

**Manufacturing, Packaging, and Labeling**

BioKey operates modular Class 100,000 cGMP cleanroom facilities for the manufacture, packaging, labeling, and release of clinical supplies for oral therapeutic and nutraceutical products in liquid, solid, and semi-solid dosage forms, supporting programs intended for the United States, Canada, and certain Asian markets. The Company's cGMP pilot plant has the capacity to manufacture approximately 5,000 to 50,000 tablets or capsules per day, depending on the specific manufacturing process, and can produce batch sizes of up to approximately 25 kilograms for early-stage clinical development programs. BioKey supports formulation and process development for Phase I and Phase II studies, as well as technology transfer of existing customer processes, and works collaboratively with customers to establish raw material, in-process, and finished product testing methods and specifications, and to prepare master batch records and master packaging records. The Company also provides packaging and labeling services for bulk materials in accordance with clinical trial protocols and applicable regulatory requirements and has expanded its capabilities to include the manufacture of nutraceutical oral drink products using a 500-liter pasteurization system.

**Clinical Trial & Regulatory Services**

BioKey provides clinical trial and regulatory support services to assist customers in the planning and execution of development programs and in meeting applicable regulatory requirements. These services include clinical protocol design, statistical analysis planning, site identification and coordination, regulatory compliance monitoring at clinical sites, patient recruitment support, trial master file management, and tracking of clinical specimens and investigational product shipments. The Company also provides regulatory affairs support, including assistance with abbreviated new drug application ("**ANDA**") and investigational new drug ("**IND**") submissions, maintenance of IND and biologics license application ("**BLA**") documentation, and support for U.S. Food and Drug Administration ("**FDA**") interactions, such as acting as a U.S. agent for regulatory communications, GDUFA self-identification, establishment registration, and product listing, in each case in support of customer-sponsored programs.

In addition, BioKey, Inc. has entered into a service collaboration with Rgene Corporation pursuant to which Rgene provides manufacturing support for drug product used in clinical trials involving the Maitake formulation, as well as regulatory process support for related applications.

**Our Strengths**

The following is a summary of our competitive strengths:

***1. Favorable Market Trends***

The Company is positioned within the growing global nutraceutical and functional ingredients sector, a market supported by strong secular demand trends in immune health, metabolic wellness, and preventive nutrition. According to Grand View Research, the global nutraceuticals market was valued at approximately US$591.1 billion in 2024 and is projected to expand to approximately US$919.1 billion by 2030<sup>13</sup>.

***2. Well-Developed Manufacturing Capabilities Leading to Higher Efficiency***

Over the years, we have developed an efficient and cost-effective manufacturing process. Specifically, a combination of modern operational and management systems, advanced manufacturing equipment, experienced manufacturing know-hows, skilled workforce, and flexible manufacturing system allows us to shorten the "time to market" for the manufacturing of our products. Moreover, the combination allows us to timely adjust our lines of products in anticipation of changes in market demands.

***3. Robust Research and Product Development Capabilities***

Research and product development capabilities have been an important component of the Company's historical activities and strategic positioning. As of the date of this filing, research and development functions are performed primarily by technical and scientific personnel of the ABVC Group and its subsidiaries and affiliates. Following the completion of the Spin-Off, the Company expects to recruit and retain its own dedicated research and development personnel to support ongoing formulation, process development, and product innovation activities.

We operate as an early-stage commercial company in the nutraceutical ingredients, dietary supplement, and contract development, and manufacturing markets. Through our operating subsidiaries and affiliates, we have completed pilot-scale commercial manufacturing and initial product launches in select markets, including Taiwan and Canada, which validated our manufacturing processes, quality systems, and supply chain readiness. While these initial launches did not generate material revenue, they established the operational foundation for broader commercialization. We are currently focused on expanding our customer base, strengthening distribution partnerships, and scaling our manufacturing and product development capabilities to support future revenue growth.

***4. Strategic Service Network***

The ability to provide timely after-sales services is critical in building and maintaining a loyal and solid customer base. We have strategically established an after-sales service network in locations with developed economies through establishing in-house service centers and employing service providers that conduct businesses predominantly in these regions. Users of our products can reach us through a service line, through which we are able to provide prompt on-site technical services.

<sup>13</sup> https://www.grandviewresearch.com/industry-analysis/nutraceuticals-market

***5. Experienced Management Team with Successful Track Records***

Our senior management team is comprised of individuals with operational experience, market knowledge, international management experience, and technical expertise across the biotechnology, nutraceutical, and functional ingredients sectors. Members of the senior management team have held senior leadership and management roles at public and private companies and have experience in company formation, product development, manufacturing, regulatory compliance, and commercialization.

● Dr. T.S. Jiang will serve as our Chief Executive Officer of the Company following the Spin-Off. Dr. T.S. Jiang has served as the Chief Strategy Officer of ABVC BioPharma, Inc. since September 2019. Since March 13, 2025, Dr. Jiang was also appointed as AiBtl's Chief Strategy Officer. Dr. Jiang serves as the CEO of Biokey, Inc. since December 2021, as a director of BioFirst Corp. since 2013, and has been the CEO and chairman of BioLite, Inc., a subsidiary of BioLite BVI, Inc., since January 2010. Prior to BioLite, Dr. Jiang served as the president and/or chairman of multiple biotech companies in Taiwan, including PhytoHealth Corporation from 1998 to 2009 and AmCad BioMed Corporation from 2008 to 2009. In addition, Dr. Jiang is a director on various biotech associations, such as the Taiwan Bio Industry Organization (Taiwan) from 2006 to 2008 and the Chinese Herbs and Biotech Development Association in Taiwan from 2003 to 2006. Dr. Jiang was an assistant professor at University of Illinois from 1981 to 1987 and an associate professor at Rutgers, the State University of New Jersey from 1987 to 1990 and served as a professor at a few Taiwanese universities during a period from 1990 to 1993, such as National Taiwan University, National Cheng Kung University and Tunghai University. Dr. Jiang obtained his bachelor degree in Engineering and Chemical Engineering from National Taiwan University in Taiwan in 1976, masters and Ph.D. from Northwestern University in the U.S. in 1981 and Executive Master of Business Administration ("EMBA") from National Taiwan University in Taiwan in 2007. As a successful entrepreneur, Dr. Jiang has developed and commercialized PG2 Lyo Injection, a new drug to treat cancer related fatigue. From 1998 to 2009, Dr. T. S. Jiang served as President of Phyto Health Corporation where he led a project team to develop PG2 Injectable. This product was extracted, isolated, and purified from a type of Traditional Chinese Medicine. PG2 Injection was intended for cancer patients who had trouble recovering from severe fatigue. Dr. Jiang oversaw and managed the R&D department, daily corporate operations, and business of Phyto Health Corporation when he was the President. PG2 Lyo Injection received approval on its NDA from Taiwan Food and Drug Administration in 2010 and later was launched into the Taiwan market in 2012. We believe that Dr. Jiang provides leadership and technological guidance on our strategic development and operations.

● Eugene Jiang will serve as our Chief Financial Officer and will be on the Board of Directors of our Company following the Spin-Off. Eugene Jiang served as CEO and President of ABVC BioPharma, Inc. from the ABVCs inception in July 2015 until he resigned on September 15, 2017. He remains the Chairman of the Board. He currently serves as ABVCs Chief Business Officer since September 2019 and serves as the Chief Business Officer of BioKey, Inc. Since March 13, 2025, Eugene Jiang was appointed as AiBtl's Chief Financial Officer. Since 2019. Mr. Jiang also serves as Director for BioLite Incorporation since June 2015 and as Director for BioFirst Corp. since 2012. He also serves as CEO for Genepro Investment Company since March 2010. Mr. Jiang obtained a PMBA degree from National Taiwan University in 2017 and an EMBA degree from the University of Texas in Arrington in 2010. And in 2009, Mr. Jiang received a bachelor's degree in Physical Education from Fu-Jen Catholic University.

● Uttam Patil will serve as our Chief Scientific Officer. Mr. Patil was appointed as the Chief Executive Officer of ABVC BioPharma, Inc. on June 21, 2023; he now serves as interim Chief Financial Officer too. Since March 13, 2025, Dr. Patil was also appointed as AiBtl's co-CEO. Dr. Patil has served as the Chief Operating and Scientific Officer of the Company's subsidiary, BioKey, Inc. since May 2023; he also works for Rgene Corporation (a related party), as the R&D Manager since May 2023, after being promoted from Project Manager, to which he serves from August 2022 to May 2023. Prior to that, Dr. Patil was a Post-Doctoral Research Fellow at NTNU from March 2020 to July 2022. In 2019, Dr. Patil received the "Platinum Award" for an Oral Presentation on the topic, "Nucleobase Functionalized Single-Walled Carbon Nanotubes Hybridization with Single-Stranded DNA" at a Workshop on Organic Chemistry for Junior Chemists held in South Korea. Dr. Patil received his Ph.D. in Chemistry from National Tsing Hua University and a Masters in Analytical Chemistry from Pune University, as well as a Bachelors in industrial chemistry from Pune University.

**Customers**

BioKey Cayman's customers include supplement brands, ingredient distributors, ABVC Group affiliates, and wellness product manufacturers in Southeast Asia and the Northern America.

A substantial portion of our historical revenues has been derived from a limited number of customers. The degree of customer concentration, including the contribution of our largest customers to total revenue for the relevant reporting periods, is disclosed in the consolidated financial statements and related notes included elsewhere in this filing. Because of this concentration, the loss of any significant customer, a reduction in order volume, unfavorable pricing changes, delays in customer programs, or the termination or completion of customer projects could materially and adversely affect our revenues, profitability, and operating results.

**Suppliers**

The Company sources raw materials including Maitake biomass, botanical extracts, excipients, and packaging materials from qualified suppliers in Asia and the United States. Supplier qualification includes GMP verification, quality audits, and raw material testing.

The prices for raw materials have historically fluctuated, which in turn has affected the Company's business and operation results. We closely monitor changes in raw material prices and seeks to adjust their inventory of raw materials during inflation periods. We also seek to price our products to reflect the expected fluctuations in raw material prices to the extent possible. However, there can be no assurance that we could precisely estimate any increase in raw material price or pass on such increase onto our customers.

**Production, Inventory, and Warehousing**

BioKey Cayman conducts pilot-scale extraction, blending, and testing at its Fremont, California facility. Commercial-scale manufacturing is performed through certified contract manufacturers in Asia and the United States. The Company maintains climate-controlled warehousing capacity in California and utilizes third-party logistics providers and contract storage facilities in Asia to support raw material storage and finished goods distribution.

**Research and Development**

Our research and development team select research or development projects or both and draws up preliminary project proposals based on various factors, such as industry and market trends, customer feedback, and input from other departments (i.e. finance and manufacturing departments).

The management, including the heads and lead managers of various internal departments, such as sales and marketing and finance departments, as well as the chief executive officer, reviews the preliminary project proposals and the research and development team formulates a final plan for each approved project after considering suggestions and comments by its management. The final plans will include detailed schedules and budgets for the projects. The finance department monitors budget overruns. Any increase in the original budget must be reviewed and approved by management before the relevant project can continue.

**Intellectual Property**

BioKey Cayman does not currently own any registered patents or trademarks. Its operations are conducted pursuant to licensed technology and know-how from ABVC affiliates, and it functions as a contract developer and manufacturer. In June 2024, BioKey Cayman entered into definitive agreements to acquire the business and technology assets of BioLite, BioFirst Corporation, and Rgene Corporation as part of a group reorganization. In June 2024, BioKey Cayman entered into definitive agreements to acquire the business and technology assets of BioLite, BioFirst, and Rgene as part of a group reorganization. As of this filing, certain integration and regulatory steps related to these transactions remain ongoing. Upon completion of the reorganization, BioKey Cayman is expected to hold proprietary formulations, extraction processes, and data packages previously held by these entities.

**Sales and Marketing**

BioKey Cayman sells its products and services primarily through direct business-to-business relationships with supplement brands, ingredient distributors, and affiliated companies. Sales activities are conducted by management and technical personnel, and the Company does not maintain a dedicated large-scale sales force. Marketing efforts include participation in industry trade shows, technical presentations, and direct customer engagement.

**Competition**

The contract research and contract development and manufacturing (CRO/CDMO**)** industry is fragmented and highly competitive. International brand manufacturers equipped with better technology and capital resources are also aiming to expand into our market. As a result, it is expected that our market will become more competitive.

The typical competitive criteria are quality, price, technology, after-sales service, product offering, and performance record. The CRO/CDMO market is capital intensive. In addition, the manufacturing process requires technical expertise and significant research and development budgets. As a result, companies entering the market must have significant financial and technical resources. Moreover, the time and cost required to establish a proven track record, necessary for general market acceptance, are substantial.

We believe that we are able to compete based on our market position, strong research and development capabilities, high quality products, integrated service systems, and strong relationships with our customers.

Our key competitors include Catalent Pharma Solutions, Thermo Fisher Scientific (Patheon), Cambrex Corporation, Curia Global, Alcami Corporation, and Piramal Pharma Solutions.

**Properties and Facilities**

BioKey operates an approximately 28,000 square foot facility in Fremont California, located within the San Francisco Bay Area, which houses its research and development laboratories and cGMP manufacturing operations. The facility includes laboratories supporting product development, formulation development, and analytical method development, as well as cGMP manufacturing suites equipped for blending, roller compaction, and tablet and capsule manufacturing of small-molecule oral therapeutic products. The facility's flexible design and integrated infrastructure support the development, formulation, and manufacture of botanical and nutraceutical products, and additional space is available to accommodate potential future expansion of laboratory and manufacturing operations. The space consists of offices, research and production laboratories, and manufacturing facilities, which are GMP certified. At the end of the lease, the Company has an option to extend or five more years. The total rental expense was $421,894 and $353,466 for the years ended December 31, 2024, and 2023, respectively. The property serves the functions of product manufacturing, research and development, warehousing, marketing, and customer services and includes:

● cGMP-certified production suites;

● Analytical and formulation laboratories;

● Warehouse and cleanroom environments;

● Office and support areas.

The facility is equipped with a comprehensive range of pilot-scale manufacturing and laboratory equipment, including:

*Analytical and Laboratory Equipment:*

● HPLC (Agilent 1260/1290 Infinity with ChemStation, Agilent 1100 with Corona ESA, Shimadzu Prominence UFLC with LabSolutions)

● FT-IR (Perkin Elmer Spectrum One)

● KF Titrator (Mettler Toledo C20SD)

● Environmental Chambers (25°C/60%RH, 30°C/65%RH, 40°C/75%RH)

● Disintegration Tester (VanKel VK 100)

● Dissolution Apparatus (Agilent 708-DS with Agilent 850-DS Sampling Station, Distek Premiere 5100 with Online Agilent UV)

● Analytical Balance (Mettler Toledo XS105)

*Manufacturing and Processing Equipment:*

● Tablet Press (Korsch XL100, Instrumented)

● Capsule Fillers (Bosch Automated, ProFiller 3600 [4,500–6,900/hr])

● High Shear Granulator (Yen Chen SMG5, 100 [5L, 100L])

● Tray Dryer/Oven (Gruenberg, Yen Chen)

● Coating Machine (O'Hara Coater II X Tab Coater – 12", 19", 30" pans)

● Conical Mill (Quadro Comil 197S)

● Twin Shell Dry Blenders (various sizes from 1-pint to 60 kg)

● Fluid Bed Dryer (Aromatic Strea1, Uni-Glatt)

● Weight Sorter (CI Electronics SADE)

● Pasteurization Tank (Bear Hangzhou 500L)

We believe that our existing facilities are sufficient for their current needs and will obtain additional facilities to accommodate our future expansion plans.

**Employees**

As of this filing, the Company's operations are supported by personnel of the ABVC Group, its subsidiaries, and affiliates. Following the completion of the Spin-Off, the Company expects that certain personnel of the ABVC Group will continue to provide transitional operational, administrative, and technical support for a limited period of time while BioKey (Cayman), Inc. recruits and hires its own dedicated employees. The Company intends to establish an independent workforce to support its ongoing business operations as a standalone public company following the Spin-Off.

We believe that our success and continued growth depend on the ability to attract, retain, and motivate qualified employees. We offer our employee's competitive salaries, comprehensive training, and other fringe benefits and incentives. None of the employees are represented by labor unions, and no collective bargaining agreement has been put in place. We have not had any labor strikes or other labor disturbances that have materially interfaced with their operations, and we believe that we have maintained a good work relationship with our employees.

**Seasonality**

Our operating results are not affected by seasonality.

**Legal Proceedings**

We may from time to time be subject to various legal or administrative claims and proceedings arising in the ordinary course of our business. We are not currently a party to any other material legal or administrative proceedings than as described in this section. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial costs and diversion of our resources, including our management's time and attention.

**Regulations**

BioKey Cayman is subject to regulatory requirements applicable to dietary supplements, functional foods, nutraceutical ingredients, and contract manufacturing activities in the jurisdictions in which it operates. In the United States, these requirements include regulations administered by the U.S. Food and Drug Administration ("**FDA**") governing current Good Manufacturing Practices ("**cGMP**") for dietary supplements, food safety, product labeling, facility registration, and recordkeeping.

BioKey Cayman's manufacturing and development activities are subject to inspection by regulatory authorities to assess compliance with applicable cGMP requirements, quality control procedures, sanitation standards, and documentation practices. Compliance with these requirements affects many aspects of the Company's operations, including raw material sourcing, manufacturing processes, packaging, labeling, storage, distribution, and import and export of botanical and nutraceutical products. Failure to comply with applicable regulatory requirements could result in regulatory enforcement actions, including warning letters, product recalls, import alerts, civil penalties, or restrictions on manufacturing or distribution activities.

In addition to U.S. federal requirements, BioKey Cayman is subject to applicable state, local, and international regulations in the jurisdictions where its products are manufactured or distributed, including regulations related to food safety, customs, import and export controls, and product registration or notification requirements. Changes in existing regulations or the adoption of new regulatory requirements could require the Company to modify its manufacturing practices, labeling, quality systems, or facilities, which could result in increased operating costs or capital expenditures.

BioKey Cayman does not manufacture FDA-approved pharmaceutical or biologic products for commercial sale and is not subject to regulatory regimes governing pharmaceutical drug approvals or clinical trial product manufacturing. However, the Company's customers may be subject to additional regulatory requirements applicable to their finished products, and regulatory actions affecting customers or supply chains could indirectly impact BioKey Cayman's operations.

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the accompanying notes thereto included elsewhere in this information statement. Some of the information contained in this discussion and analysis or set forth elsewhere in this information statement, including information with respect to our plans and strategy for our business, includes forward-looking information statement that involve risks and uncertainties. You should read the sections titled "Risk Factors" and "Cautionary Statement Concerning Forward-Looking Statements" for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Management's Discussion and Analysis of Financial Condition and Results of Operations is intended to help you understand the results of operations and financial condition of the business for the three months ended March 31, 2026 and 2025 and for the years ended December 31, 2024 and 2025.

**Overview**

BioKey (Cayman), Inc. ("BioKey Cayman," the "Company," "we," "our," or "us") is a wholly-owned subsidiary of ABVC BioPharma, Inc ("ABVC") formed to operate as an independent nutraceutical and functional supplement research, development, and manufacturing platform. On May 10, 2025, the Company entered into a share transfer agreement with ABVC and BK California, pursuant to which the Company acquired 100% of the equity interest of BK California from ABVC in exchange for $100 (the "**2025 Reorganization**"). BK California was incorporated in California on November 20, 2020, and was a wholly owned subsidiary of ABVC. BK California's mission is to capitalize on the growth opportunities in the generic drug market. Currently, BK California is a pharmaceutical manufacturing and development company.

BioKey Cayman's revenue was generated by BK California in 2024, and has been organized to receive, develop, and commercialize assets transferred from ABVC, including proprietary formulations based on botanical extracts such as Maitake mushroom and Polygala tenuifolia.

Following the planned spin-off, we intend to operate as a contract research, development, and manufacturing organization (CRDMO) dedicated to nutraceuticals and functional supplements, with a focus on cGMP-certified production, regulatory compliance, and commercialization in Asia and North America.

**Results of Operations**

As BioKey Cayman was recently formed, we have no operating revenues for the periods presented except for the revenue generated by BK California in 2024. Our historical expenses consist primarily of organizational costs and professional fees associated with incorporation, regulatory filings, and preparation for the planned spin-off.

Post spin-off, our expenses are expected to increase significantly as we:

● Establish dedicated R&D and manufacturing operations for nutraceutical and functional supplement products.

● Incur regulatory compliance and quality control costs related to cGMP operations.

● Expand business development and commercialization activities in key geographies.

**Summary of Critical Accounting Policies**

<u>Basis of Presentation</u>

The accompanying consolidated financial statements have been prepared in accordance with the U.S. GAAP and pursuant to the regulations of the Securities and Exchange Commission (the "**SEC**"). All significant intercompany transactions and account balances have been eliminated. The Company's fiscal year is the calendar year.

<u>Use of Estimates</u>

The preparation of financial statements in conformity with the U.S. GAAP that requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the amount of revenues and expenses during the reporting periods. Actual results could differ materially from those results.

<u>Fair Value Measurements</u>

ASC 820 "Fair Value Measurements" defines fair value for certain financial and nonfinancial assets and liabilities that are recorded at fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. It requires that an entity measures its financial instruments to base fair value on exit price, maximize the use of observable units and minimize the use of unobservable inputs to determine the exit price. It establishes a hierarchy which prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy increases the consistency and comparability of fair value measurements and related disclosures by maximizing the use of observable inputs and minimizing the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the assets or liabilities based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in circumstances. The hierarchy prioritizes the inputs into three broad levels based on the reliability of the inputs as follows:

Level 1 – Inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date. Valuation of these instruments does not require a high degree of judgment as the valuations are based on quoted prices in active markets that are readily and regularly available.

Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable as of the measurement date, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Valuations based on inputs that are unobservable and not corroborated by market data. The fair value for such assets and liabilities is generally determined using pricing models, discounted cash flow methodologies, or similar techniques that incorporate the assumptions a market participant would use in pricing the asset or liability.

The carrying values of certain assets and liabilities of the Company, such as cash and cash equivalents, accounts receivable, due from related parties, prepaid expenses and other current assets, accrued expenses and other current liabilities, and due to related parties, approximate fair value due to their relatively short maturities. The carrying value of the Company's short-term bank loans, convertible notes payable, and accrued interest approximates their fair value as the terms of the borrowing are consistent with current market rates and the duration to maturity is short.

<u>Concentration of Credit Risk</u>

The Company's financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. The Company deposits cash in reputable financial institutions covered by FDIC's $250,000 insurance, though amounts may exceed the $250,000 FDIC insurance limit. However, the Company does not anticipate any losses on excess deposits. The Company does not enter financial instruments for hedging, trading, or speculative purposes.

The Company performs ongoing credit evaluation of its customers and requires no collateral. Credit losses and allowance for unbilled receivables are provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining its historical collection experience, current economic conditions, reasonable and supportable forecasts of future economic conditions, as well as its internal credit policies. Actual credit losses may differ from our estimates.

<u>Revenue Recognition</u>

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Pursuant to ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines is within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration the Company is entitled to in exchange for the goods or services the Company transfers to the customers. At inception of the contract, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

<u>CDMO Service Revenue</u>

The Company's revenues are mainly derived from Research and Development Activities Services (also known as the Contract Development & Manufacturing Organization Services ("**CDMO**"). Revenues related to research and development and regulatory activities are recognized when the related services or activities are performed, in accordance with the contract terms. The Company typically has only one performance obligation at the beginning of a contract, which is to perform research and development services. The Company may also provide its customers with an option to request that the Company provides additional goods or services in the future, such as active pharmaceutical ingredients, API, or IND/NDA/ANDA/510K submissions. The Company evaluates whether these options are material rights at the inception of the contract. If the Company determines an option is a material right, the Company will consider the option a separate performance obligation.

If the Company is entitled to reimbursement from its customers for specified research and development expenses, the Company accounts for the related services that it provides as separate performance obligations if it determines that these services represent a material right. The Company also determines whether the reimbursement of research and development expenses should be accounted for as revenues or an offset to research and development expenses in accordance with provisions of gross or net revenue presentation. The Company recognizes the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance obligations.

The Company then determines the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts, including any variable consideration. Under the outstanding contracts, consideration typically includes fixed consideration and variable consideration in the form of potential milestone payments. At the start of an agreement, the Company's transaction price usually consists of the payments made to or by the Company based on the number of full-time equivalent researchers assigned to the project and the related research and development expenses incurred. The Company does not typically include any payments that the Company may receive in the future in its initial transaction price because the payments are not probable. The Company would reassess the total transaction price at each reporting period to determine if the Company should include additional payments in the transaction price.

The Company receives payments from its customers based on billing schedules established in each contract. Upfront payments and fees may be recorded as advances from customers upon receipt or when due, and may require deferral of revenue recognition for a future period until the Company performs its obligations under these arrangements. Amounts are recorded as accounts receivable when the right of the Company to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customers and the transfer of the promised goods or services to the customers will be one year or less.

<u>Property and Equipment, net</u>

Property and equipment, net is carried at cost net of accumulated depreciation. Repairs and maintenance are expensed as incurred. Expenditures that improve the functionality of the related asset or extend the useful life are capitalized. When property and equipment are retired or otherwise disposed of, the related gain or loss is included in operating income. Leasehold improvements are depreciated on the straight-line method over the shorter of the remaining lease term or estimated useful life of the asset. Depreciation is calculated on the straight-line method generally based on the following useful lives:

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| | |
|:---|:---|
|  | **Estimated Life<br> in Years** |
| Leasehold improvements | 3 ~ 15 |
| Machinery and equipment | 3 ~ 8 |
| Office equipment | 3 |

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<u>Impairment of Long-Lived Assets</u>

The Company has followed the guidance of ASC subtopic 360-10, Property, Plant and Equipment. ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates its long-lived assets for impairment annually or more often if events and circumstances warrant. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. ASC 360-10 also requires assets to be disposed of to be reported at the lower of the carrying amount or the fair value less costs to sell.

<u>Research and Development Expenses</u>

The Company accounts for the cost of using licensing rights in research and development costs according to ASC 730-10-25-1. This guidance provides that absent alternative future uses the acquisition of product rights to be used in research and development activities must be charged to research and development expenses when incurred.

The Company accounts for R&D costs in accordance with ASC 730 "Research and Development". Research and development expenses are charged to expense as incurred unless there is an alternative future use in other research and development projects or otherwise. Research and development expenses are comprised of costs incurred in performing research and development activities, including personnel-related costs, facilities-related overhead, and outside contracted services including clinical trial costs, manufacturing, and process development costs for both clinical and preclinical materials, research costs, and other consulting services. Non-refundable advance payment for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made. In instances where the Company enters into agreements with third parties to provide research and development services, costs are expensed as services are performed.

<u>Income Taxes</u>

The Company accounts for income taxes using the asset and liability approach which allows the recognition and measurement of deferred tax assets to be based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will expire before the Company is able to realize their benefits, or future deductibility is uncertain.

Under ASC 740, a tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefits recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer satisfied. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalty or interest relating to income taxes has been incurred for the years ended December 31, 2025 and 2024. GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition.

<u>Valuation of Deferred Tax Assets</u>

A valuation allowance is recorded to reduce the Company's deferred tax assets to the amount that is more likely than not to be realized. In assessing the need for the valuation allowance, management considers, among other things, projections of future taxable income and ongoing prudent and feasible tax planning strategies. If the Company determines that sufficient negative evidence exists, then it will consider recording a valuation allowance against a portion or all of the deferred tax assets in that jurisdiction. If, after recording a valuation allowance, the Company's projections of future taxable income and other positive evidence considered in evaluating the need for a valuation allowance prove, with the benefit of hindsight, to be inaccurate, it could prove to be more difficult to support the realization of its deferred tax assets. As a result, an additional valuation allowance could be required, which would have an adverse impact on its effective income tax rate and results. Conversely, if, after recording a valuation allowance, the Company determines that sufficient positive evidence exists in the jurisdiction in which the valuation allowance was recorded, it may reverse a portion or all of the valuation allowance in that jurisdiction. In such situations, the adjustment made to the deferred tax asset would have a favorable impact on its effective income tax rate and results in the period such determination was made.

<u>Commitments and Contingencies</u>

The Company has adopted ASC 450 "Contingencies" subtopic 20, in determining its accruals and disclosures with respect to loss contingencies. Accordingly, estimated losses from loss contingencies are accrued by a charge to income when information available before financial statements are issued or are available to be issued indicates that it is probable that an asset had been impaired or a liability had been incurred on the date of the financial statements, and the amount of the loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. If a loss contingency is not probable or reasonably estimable, disclosure of the loss contingency is made in financial statements when it is at least reasonably possible that a material loss could be incurred.

<u>Recent Accounting Pronouncements</u>

In November 2024, the FASB issued ASU No. 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disclosure of specified information about certain costs and expenses. This includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The ASU is effective on a prospective or retrospective basis for annual reporting period beginning after December 15, 2026, and interim reporting period beginning after December 15, 2027. Early adoption is permitted. This ASU will likely result in the required additional disclosures and the Company expects no material impact on consolidated financial statements of adopting.

The Company will continue to monitor other issued but not yet effective standards and will update its disclosures as more information becomes available.

**Estimates and Assumptions**

In preparing our consolidated financial statements, we use estimates and assumptions that affect the reported amounts and disclosures. Our estimates are often based on complex judgments, probabilities and assumptions that we believe to be reasonable, but that are inherently uncertain and unpredictable. We are also subject to other risks and uncertainties that may cause actual results to differ from estimated amounts.

**Results of Operations — Ended December 31, 2024 Compared to Year Ended December 31, 2025**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | | |
|  | **2025** | **2024** | **Increase**<br>**(Decrease)** |<br>**%** |
| Revenue | $- | $13589 | $(13589) | -100% |
| Gross Profits | $- | $12826 | $(12826) | -100% |
| Operating Expenses | $712319 | $764854 | $(52535) | -7% |
| Loss from Operations | $(712319) | $(752028) | $39709 | -5% |
| Other Expense, Net | $(30753) | $(39252) | $8499 | -22% |
| Interest Expense, Net | $(153891) | $(153487) | $(404) | 0% |
| Net Loss | $(743072) | $(791280) | $48208 | -6% |

---

***Revenues.*** We didn't generate any revenue in 2025, while we had $13,589 in revenue for the year ended December 31, 2024. During the year 2025, the Company was focusing on organization restructuring and operation strategies. Certain CDOM services were provided, and revenues were recognized in 2024.

***Operating Expenses*.** Our operating expenses were $712,319 for the year ended December 31, 2025, compared to $764,854 for the year ended December 31, 2024. Such decrease in operating expenses was mainly attributable to the decrease in selling, general and administrative expenses, as we have been focusing on our cost control initiatives to reduce cash burns.

***Other Expense, Net***. Other expenses were $30,753 for the year ended December 31, 2025, compared to $39,252 for the year ended December 31, 2024. This category mainly includes sublease income and the net of interest income and expenses. Besides discussed below, other income remains consistent between two years.

***Interest Expense, Net,*** was $153,891 for the year ended December 31, 2025, compared to $153,487 for the year ended December 31, 2024. Our loan balances from ABVC, our parent company, were consistent between two periods.

***Net Loss.*** The net loss was $743,072 for the year ended December 31, 2025, compared to $791,280 for the year ended December 31, 2024. The Company reduced its net loss by $48,208 or approximately -6% during the year ended December 31, 2025, through more strict cost controls.

**Results of Operations — Three Months Period Ended March 31, 2026 Compared to Three Months Ended March 31, 2025**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended<br> March 31,** | **Three Months Ended<br> March 31,** | | |
|  | **2026** | **2025** | **Increase**<br>**(Decrease)** |<br>**%** |
| Revenue | $- | $- | $- | -% |
| Gross Profits | $- | $- | $- | -% |
| Operating Expenses | $184230 | $129576 | $54654 | 42% |
| Loss from Operations | $(184230) | $(129576) | $(54654) | 42% |
| Other Expense, Net | $(23496) | $(23410) | $(86) | -% |
| Interest Expense, Net | $(41496) | $(41128) | $(368) | 1% |
| Net Loss | $(207726) | $(152986) | $(54740) | 36% |

---

 ****

***Revenues.*** We didn't generate any revenue for both of the three months periods ended March 31, 2026 and 2025, respectively.

***Operating Expenses*.** Our operating expenses were $184,230 for the three months period ended March 31, 2026, compared to $129,576 for the three months period ended March 31, 2025. Such increase in operating expenses was mainly attributable to the decrease in higher rent.

***Other Expense, Net.*** Other income was $23,496 for the three months period ended March 31, 2026, compared to $23,410 for the three months period ended March 31, 2025. This category mainly includes sublease income and the net of interest income and expenses. It was consistent between two periods.

***Interest Expense, Net***, was $41,496 for the three months ended March 31, 2026, compared to $41,128 for the three months period ended March 31, 2025. It was consistent between two periods.

***Net Loss.*** The net loss was $207,726 for the three months period ended March 31, 2026, compared to $152,986 for the three months period ended March 31, 2025. The increase is mainly due to certain higher operating expenses incurred during this period.

**Liquidity and Capital Resources**

Since inception, our activities have been funded by ABVC BioPharma, Inc. As of March 31, 2026, BioKey Cayman had $1,614 cash and cash equivalent in hand.

We expect to continue incurring operating losses until we are able to generate revenues from nutraceutical product sales and CRDMO service contracts. To finance our operations, we will rely on:

● Initial capitalization and asset transfers from ABVC.

● Proceeds from potential equity or debt financings following the spin-off.

● Strategic partnerships and customer contracts in the nutraceutical sector.

Our ability to continue as a going concern depends on raising sufficient capital and successfully executing our business plan.

**<u>Working Capital</u>**

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| | | |
|:---|:---|:---|
|  | **As of<br> March 31, 2026** | **As of<br> December 31,<br> 2025** |
| Current Assets | $56159 | $61822 |
| Current Liabilities | $5697629 | $5495711 |
| Working Deficit | $(5641470) | $(5433889) |

---

**Cash flow analysis**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | | |
|  | **2025** | **2024** | **Increase**<br>**(Decrease)** |<br>**%** |
| Cash Flow Used In Operating Activities | $(678388) | $(591578) | $(86810) | 15% |
| Cash Flow Used in Investing Activities | $- | $- | $- | -% |
| Cash Flow Provided by Financing Activities | $673126 | $587457 | $85669 | 15% |

---

**Cash Flow from Operating Activities**

During the years ended December 31, 2025 and 2024, the net cash used in operating activities were $678,388 and $591,578, respectively. The increase in the amount of outflow $86,810 was primarily due to decrease in operating losses, offsetting by refunding of tenant deposit.

**Cash Flow from Financing Activities**

During the years ended December 31, 2025 and 2024, the net cash provided by financing activities were $673,126 and $587,457, respectively. Our funding is relied on our related party, ABVC.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended<br> March 31** | **Three Months Ended<br> March 31** | | |
|  | **2026** | **2025** | **Increase**<br>**(Decrease)** |<br>**%** |
| Cash Flow Used In Operating Activities | $(41269) | $(1757) | $(39512) | 2249% |
| Cash Flow Used in Investing Activities | $- | $- | $- | -% |
| Cash Flow Provided by Financing Activities | $40000 | $- | $40000 | -% |

---

**Cash Flow from Operating Activities**

During the three months periods ended March 31, 2026 and 2025, the net cash used in operating activities were $41,269 and $1,757, respectively. The increase in the outflow $39,512 was primarily due to increase in operating expenses.

**Cash Flow from Financing Activities**

During the three months periods ended March 31, 2026 and 2025, the net cash provided by financing activities were $40,000 and $0, respectively. Our funding is relied on our related party, ABVC.

**Known Trends and Uncertainties**

We face a number of risks and uncertainties, including:

● Regulatory requirements for nutraceuticals and functional supplements vary across jurisdictions and may increase.

● Market adoption of new formulations may be slower than anticipated.

● We are dependent on a limited number of suppliers for raw botanical materials.

● Competition from established nutraceutical companies may limit our ability to capture market share.

● As a newly spun-off company, we may face challenges in accessing capital on favorable terms.

**Outlook**

We believe that the spin-off will provide BioKey Cayman with the independence and flexibility to pursue its growth strategy, focusing on the multi-billion-dollar global nutraceutical market projected to reach over $167 billion by 2030. With a dedicated management team, proprietary botanical technologies, and cGMP manufacturing capabilities, BioKey Cayman aims to establish itself as a differentiated CRDMO platform serving both ABVC affiliates and third-party clients.

**MANAGEMENT AND BOARD OF DIRECTORS**

**Our Directors and Executive Officers**

The following table presents information concerning our directors and executive officers as of the date of this information statement.

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Dr. Tsung-Shann (T.S.) Jiang | 69 | Chief Executive Officer |
| Eugene Jiang | 38 | Chief Financial Officer and Director |
| Dr. Uttam Patil | 39 | Chief Scientific Officer |
| Shuling Jiang | 69 | Director |
| Yu-Min (Francis) Chung | 60 | Independent Director |
| Toru Seo | 60 | Independent Director |

---

**Dr. T.S. Jiang**, will serve as our Chief Executive Officer following the Spin-Off. Dr. T.S. Jiang has served as the Chief Strategy Officer of ABVC BioPharma, Inc. since September 2019. Since March 13, 2025, Dr. Jiang was also appointed as AiBtl's Chief Strategy Officer. Dr. Jiang serves as the CEO of Biokey, Inc. since December 2021, as a director of BioFirst Corp. since 2013, and has been the CEO and chairman of BioLite, Inc., a subsidiary of BioLite BVI, Inc., since January 2010. Prior to BioLite, Dr. Jiang served as the president and/or chairman of multiple biotech companies in Taiwan, including PhytoHealth Corporation from 1998 to 2009 and AmCad BioMed Corporation from 2008 to 2009. In addition, Dr. Jiang is a director on various biotech associations, such as the Taiwan Bio Industry Organization (Taiwan) from 2006 to 2008 and the Chinese Herbs and Biotech Development Association in Taiwan from 2003 to 2006. Dr. Jiang was an assistant professor at University of Illinois from 1981 to 1987 and an associate professor at Rutgers, the State University of New Jersey from 1987 to 1990 and served as a professor at a few Taiwanese universities during a period from 1990 to 1993, such as National Taiwan University, National Cheng Kung University and Tunghai University. Dr. Jiang obtained his bachelor degree in Engineering and Chemical Engineering from National Taiwan University in Taiwan in 1976, masters and Ph.D. from Northwestern University in the U.S. in 1981 and Executive Master of Business Administration ("EMBA") from National Taiwan University in Taiwan in 2007. As a successful entrepreneur, Dr. Jiang has developed and commercialized PG2 Lyo Injection, a new drug to treat cancer related fatigue. From 1998 to 2009, Dr. T. S. Jiang served as President of Phyto Health Corporation where he led a project team to develop PG2 Injectable. This product was extracted, isolated, and purified from a type of Traditional Chinese Medicine. PG2 Injection was intended for cancer patients who had trouble recovering from severe fatigue. Dr. Jiang oversaw and managed the R&D department, daily corporate operations, and business of Phyto Health Corporation when he was the President. PG2 Lyo Injection received approval on its NDA from Taiwan Food and Drug Administration in 2010 and later was launched into the Taiwan market in 2012. We believe that Dr. Jiang provides leadership and technological guidance on our strategic development and operations.

**Eugene Jiang**, will serve as our Chief Financial Officer and will be on the Board of Directors of our Company following the Spin-Off. Eugene Jiang served as CEO and President of ABVC BioPharma, Inc. from the ABVCs inception in July 2015 until he resigned on September 15, 2017. He remains the Chairman of the Board. He currently serves as ABVCs Chief Business Officer since September 2019 and serves as the Chief Business Officer of BioKey, Inc. Since March 13, 2025, Eugene Jiang was appointed as AiBtl's Chief Financial Officer. Since 2019. Mr. Jiang also serves as Director for BioLite Incorporation since June 2015 and as Director for BioFirst Corp. since 2012. He also serves as CEO for Genepro Investment Company since March 2010. Mr. Jiang obtained a PMBA degree from National Taiwan University in 2017 and an EMBA degree from the University of Texas in Arrington in 2010. And in 2009, Mr. Jiang received a bachelor's degree in Physical Education from Fu-Jen Catholic University.

**Dr. Uttam Patil** will serve as our Chief Scientific Officer. Mr. Patil was appointed as the Chief Executive Officer of ABVC BioPharma, Inc. on June 21, 2023; he now serves as interim Chief Financial Officer too. Since March 13, 2025, Dr. Patil was also appointed as AiBtl's co-CEO. Dr. Patil has served as the Chief Operating and Scientific Officer of the Company's subsidiary, BioKey, Inc. since May 2023; he also works for Rgene Corporation (a related party), as the R&D Manager since May 2023, after being promoted from Project Manager, to which he serves from August 2022 to May 2023. Prior to that, Dr. Patil was a Post-Doctoral Research Fellow at NTNU from March 2020 to July 2022. In 2019, Dr. Patil received the "Platinum Award" for an Oral Presentation on the topic, "Nucleobase Functionalized Single-Walled Carbon Nanotubes Hybridization with Single-Stranded DNA" at a Workshop on Organic Chemistry for Junior Chemists held in South Korea. Dr. Patil received his Ph.D. in Chemistry from National Tsing Hua University and a Masters in Analytical Chemistry from Pune University, as well as a Bachelors in industrial chemistry from Pune University.

**Shuling Jiang**, will serve on our Board of Directors following the Spin-Off. Shuling Jiang has served as a director for various companies, including ABVC BioPharma, Inc., BioLite, Inc. and BioFirst Corp, since 2017 and started to serve as Managing Director for Biokey, Inc. in 2022. Ms. Jiang received a Bachelor Degree from National Taiwan Normal University School of Music in 1978 and a Master Degree from Northwestern University School of Music in 1983.

**Yu-Min (Francis) Chung**, will serve on our Board of Directors following the Spin-Off. Yu-Min (Francis) Chung was a Partner at Maxpro Ventures, an investment firm in Taiwan focused on breakthrough biomedical technology companies, from July 2018 to May 2022. Prior to that, he served as Vice President at TaiAn Technology, which is a biotechnology service company and a management company for biotechnology venture capital funds in Taiwan, from June 2016 to June 2018. Mr. Chung received his Bachelor's Degree of Science in Chemistry from National Taiwan University in 1987, Master's Degree in Business Administration from National Taiwan University in 2006, and Ph.D. in Pharmacy from University of Iowa in 1995.

**Toru Seo**, will serve on our Board of Directors following the Spin-Off. Mr. Seo has served as Chief Executive Officer of K.K. Newsight Tech Angels, an angel investment and accelerator firm in Japan, since 2022, and as Chief Executive Officer of Lucidaim Co. Ltd., an investment and consulting company in Japan, since 2021. He has also served as a Corporate Officer of M&J Company Co. Ltd., an angel investment and accelerator company in Japan, since 2023, and as an Outside Director of Cellusion Inc., a biotechnology company focused on cell therapy, since 2021. Mr. Seo received his Bachelor of Science Degree in Chemistry/Biology from Charleston Southern University in 1990, and his Ph.D. in Pathology from Wake Forest University in 1996.

There will be no changes to our executive officers and directors immediately following the effective Spin-Off. We are in the process of identifying other individuals who will also be our directors and executive officers following the Spin-Off, and we expect to provide additional details regarding these individuals in an amendment to this information statement.

**Our Board of Directors Following the Spin-Off and Director Independence**

Immediately following the Spin-Off, we expect that our Board will comprise of four (4) directors, with Yu-Min (Francis) Chung and Toru Seo both being "independent directors" as defined in applicable SEC rules. Our independent directors will have regularly scheduled meetings at which only independent directors are present.

**Committees of the Board**

Effective upon the completion of the Spin-Off, our Board will have the following committees, each of which will operate under a written charter that will be posted on our website prior to the Spin-Off.

***Audit Committee***

The Audit Committee will be established in accordance with Section 3(a)(58)(A) and Rule 10A-3 under the Exchange Act. The responsibilities of our Audit Committee will be more fully described in our Audit Committee charter. We anticipate that our Audit Committee, among other duties, will oversee:

● selecting our independent registered public accounting firm and pre-approving all auditing and non-auditing services performed by our independent registered public accounting firm;

● reviewing with the independent registered public accounting firm any audit problems or difficulties and management's response;

● reviewing and approving all proposed related-party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;

● discussing the annual audited financial statements with management and our independent registered public accounting firm;

● annually reviewing and reassessing the adequacy of our audit committee charter;

● meeting separately and periodically with management and our independent registered public accounting firms;

● reporting regularly to the full board of directors; and

● performing such other matters that are specifically delegated to our audit committee by our Board from time to time.

The Audit Committee will have at least three members and will consist entirely of independent directors, each of whom will meet the independence requirements set forth in Rule 10A-3 under the Exchange Act and our Audit Committee charter. Each member of the Audit Committee will be financially literate, and at least one member of the Audit Committee will have accounting and related financial management expertise and satisfy the criteria to be an "audit committee financial expert" under the rules and regulations of the SEC, as those qualifications are interpreted by our Board in its business judgment.

Prior to the consummation of Spin-Off, we will establish an audit committee of the board of directors. Yu-Min (Francis) Chung and Toru Seo will serve as members of our audit committee, and Yu-Min (Francis) Chung will chair the Audit Committee. Under the applicable SEC rules, we are required to have at least two members of the audit committee, all of whom must be independent. Each of Yu-Min (Francis) Chung and Toru Seo meet the independent director standard under Rule 10A-3(b)(1) of the Exchange Act.

Each member of the audit committee is financially literate, and our board of directors has determined that qualifies as an "audit committee financial expert" as defined in applicable SEC rules.

***Compensation Committee***

The responsibilities of our Compensation Committee will be more fully described in our Compensation Committee charter, and we anticipate that they will include, among other duties:

● reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers;

● reviewing and recommending to the Board for determination with respect to the compensation of our non-employee directors;

● reviewing and making recommendations to the Board with respect to the compensation of our directors;

● reviewing periodically and approving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans; and

● selecting compensation consultant, legal counsel, or other adviser only after taking into consideration all factors relevant to that person's independence from management.

The Compensation Committee will have at least two members and will consist entirely of independent directors, each of whom will meet the independence requirements set forth in Rule 10C-1 under the Exchange Act and our Compensation Committee charter. The members of our Compensation Committee will be "non-employee directors" (within the meaning of Rule 16b-3 under the Exchange Act) and "outside directors" (within the meaning of Section 162(m) of the Internal Revenue Code). Prior to the consummation of this Spin-Off, we will establish a compensation committee of the board of directors. Yu-Min (Francis) Chung and Toru Seo will serve as members of our compensation committee and Toru Seo will chair the Compensation Committee. Under the applicable SEC rules, we are required to have at least two members of the compensation committee, all of whom must be independent. Each of Yu-Min (Francis) Chung, and Toru Seo meet the independent director standard under Rule 10A-3(b)(1) of the Exchange Act.

*Compensation Committee Interlocks and Insider Participation*

We are not a separate or independent company as of the date of this information statement and did not have a Compensation Committee or any other committee serving a similar function for the fiscal year ended December 31, 2025. Decisions as to the compensation for that fiscal year of those who will serve as our executive officers were made by ABVC, as described in the section of this information statement captioned "Executive Compensation."

***Nominating and Governance Committee***

The responsibilities of our Nominating and Governance Committee will be more fully described in our Nominating and Governance Committee charter, and we anticipate that they will include, among other duties:

● identifying and recommending nominees for election or re-election to our board of directors, or for appointment to fill any vacancy;

● reviewing annually with our board of directors its composition in light of the characteristics of independence, age, skills, experience and availability of service to us;

● identifying and recommending to our board the directors to serve as members of committees;

● advising the board periodically with respect to developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations;

● making recommendations to our board of directors on corporate governance matters and on any corrective action to be taken; and

● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure compliance.

The Nominating and Governance Committee will consist entirely of independent directors, each of whom will meet the independence requirements set forth in our Nominating and Governance Committee charter. Prior to the consummation of this Spin-Off, we will establish a Nomination and Governance committee of the board of directors. Yu-Min (Francis) Chung and Toru Seo will serve as members of our Nomination and Governance Committee, and Toru Seo will chair the Nomination and Governance Committee. Each of Yu-Min (Francis) Chung and Toru Seo meet the independent director standard under Rule 10A-3(b)(1) of the Exchange Act.

**Board's Role in Risk Oversight**

Our management is principally responsible for defining, identifying, and assessing the various risks we face, formulating enterprise risk management policies and procedures and managing our risk exposures on a day-to-day basis. Management will provide an annual risk assessment to the Board, with quarterly updates. The Board's responsibility is to oversee our risk management processes by understanding and evaluating management's identification, assessment, and management of our critical risks.

The Board as a whole has responsibility for this risk oversight, assisted by the Audit Committee, the Compensation Committee and the Nominating and Governance Committee. Areas of focus include strategic, operational, liquidity, market, financial, reporting, succession, compensation, compliance, privacy, information security, cybersecurity, business conduct, health, and safety, environmental, social, governance and other risks. The Audit Committee is tasked with oversight of financial, reporting and compliance risk management, along with our overall risk management program. The Compensation Committee is tasked with oversight of compensation risk management. The Nominating and Governance Committee manages risks associated with corporate governance, Board composition, and the performance of the Board, its committees, and directors. The Board as a whole oversees all other risk management.

***Code of Business Ethics***

Prior to the completion of the Spin-Off, we will adopt a written code of business ethics that is designed to deter wrongdoing and to promote, among other things:

● honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

● the protection of the confidentiality of our non-public information;

● the responsible use of and control over our assets and resources;

● full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with the SEC and other regulators and in our other public communications;

● compliance with applicable laws, rules, and regulations; and

● accountability for adherence to the code and prompt internal reporting of any possible violation of the code.

**Director Nomination Process**

Our initial Board will be selected through a process involving both ABVC and us. The initial directors who will serve after the Spin-Off will begin their terms at the time of the Share Distribution, with the exception of one independent director who will begin his or her term prior to the Share Distribution Date and will serve on our Audit Committee, Compensation Committee, and Nominating and Governance Committee.

**Communications with Non-Management Members of the Board of Directors**

Generally, it is the responsibility of our management to speak for us in communications with outside parties, but we intend to set forth, in our corporate governance policies, certain processes by which shareholders and other interested third parties may communicate with non-management members of our Board.

**Director Compensation**

Following the Spin-Off, we expect that our Compensation Committee will periodically review and make recommendations to our Board regarding the form and amount of compensation for our directors. ABVC has approved an initial director compensation program for the Company that is designed to enable continued attraction and retention of highly qualified directors and to address the time, effort, expertise, and accountability required of active Board membership. This program is described in further detail below.

***Annual Compensation***

In general, we believe that annual compensation for our directors should consist of both a cash component, designed to compensate members for their service on the Board and its committees, and an equity component, designed to align the interests of directors and shareholders and, by vesting over time, to create an incentive for continued service on the Board.

The Company may, from time to time following the completion of the Spin-Off, grant equity-based compensation to members of its Board of Directors. Any such equity compensation would be performance-based, as determined by the Compensation Committee in its discretion, and subject to approval by the Board of Directors of the Company. The Company has not approved any director's equity compensation arrangements prior to the completion of the Spin-Off.

Cash elements are expected to be paid in quarterly installments and prorated for partial years of service.

***Other Benefits***

Non-employee directors will also be provided with reimbursement of business travel expenses incurred as part of their work for the Board.

**EXECUTIVE COMPENSATION**

**Compensation Discussion and Analysis**

We have prepared this discussion in connection with our Spin-Off from ABVC. As discussed above, we are currently part of ABVC and are not an independent company, and our Compensation Committee has not yet been formed. Decisions about the compensation and benefits payable to the individuals who will become our executive officers will be made by our compensation committee, once formed; following the Spin-Off, we expect that our Compensation Committee will review the compensation ABVC currently pays to our executive officers and determine the appropriate compensation and benefits for them.

Since the information presented in this section relates to the fiscal year ended December 31, 2025, the analysis is based on the compensation and policies ABVC applied to the persons expected to serve as our executive officers following the Spin-Off.

This Compensation Discussion and Analysis presents historical compensation information for the following individuals expected to serve as our executive officers (the "**NEOs**") following the Spin-Off:

&nbsp;&nbsp;&nbsp;&nbsp;1. Dr. T.S. Jiang, our Chief
 Executive Officer, has served at ABVC since 2019. He will continue to serve in his role as Chief Scientific Officer, Chief Strategy
 Officer, and Director of ABVC and will divide his time and responsibilities between ABVC and SpinCo using best business judgement
 and in dialogue with the board of directors.

&nbsp;&nbsp;&nbsp;&nbsp;2. Eugene Jiang, our Chief
 Financial Officer, has served at ABVC since 2015. He will continue to serve in his role as Chairman of the Board and Chief Business
 Officer of ABVC and will divide his time and responsibilities between ABVC and SpinCo using best business judgement and in dialogue
 with the board of directors.

&nbsp;&nbsp;&nbsp;&nbsp;3. Dr. Uttam Patil, our Chief
 Scientific Officer, has served at ABVC since 2023. He will continue to serve in his role as CEO and interim CFO of ABVC and will
 divide his time and responsibilities between ABVC and SpinCo using best business judgement and in dialogue with the board of directors.

The terms of employment for Dr. T.S. Jiang and Eugene Jiang, are summarized in the section entitled "*Offer Letters and Employment Agreements of Our Executive Officers*."

We are currently in the process of identifying additional individuals who will serve as our executive officers following completion of the Spin-Off.

**Compensation of NEOs in the Fiscal Year ended December 31, 2025**

BioKey Cayman was formed in 2023 and, since inception, has not had any executive officers. During this period, BioKey Cayman has had a single director, Eugene Jiang, and no compensation has been paid by BioKey Cayman to any executive officer or director. To the extent any compensation was paid to any persons who were officers or directors of ABVC and is expected to be an officer or director of BioKey Cayman, such compensation was paid by ABVC and not by BioKey Cayman. Accordingly, BioKey Cayman has not paid, awarded, or accrued any executive or director compensation that would require disclosure under Item 402 of Regulation S-K.

 ****

***Outstanding Equity Awards at Fiscal Year-End***

As of December 31, 2025, there are no outstanding equity awards.

***Option Exercise and Stock Vested Table***

In the fiscal year ended December 31, 2025, there was no exercise of stock options, share appreciation rights or similar instruments, or vesting of shares, including restricted shares, restricted share units and similar instruments.

***Pension Benefits***

ABVC does not offer our executive officers or employees any pension plan or similar plan that provides for payments or other benefits at, following or in connection with retirement and we do not expect to do so either after the Spin-Off.

***Potential Payments Upon Termination or Change in Control***

None.

**Anticipated Compensation Program Design of SpinCo Following the Spin-Off**

***Overview***

As described above, our Compensation Committee will not be established until the Spin-Off and therefore has not established a specific set of objectives or principles for our compensation programs following the Spin-Off. The executive compensation programs in place at the time of the Spin-Off will be those established by ABVC on our behalf. Following the Spin-Off, our Compensation Committee will review each of the elements of our compensation programs. We believe that the Spin-Off will enable us to offer our key employees' compensation directly linked to the performance of our business, which we expect will enhance our ability to attract, retain, and motivate qualified personnel and serve the interests of our shareholders.

***Offer Letters and Employment Agreements of Our Executive Officers***

*Chief Financial Officer and Chairman of the Board of Directors Offer Letter*

The Company intends to enter into an offer letter with Mr. Eugene Jiang appointing him as the Chairman of the Board of Directors of SpinCo upon the effectiveness of the Spin-Off. Under the proposed terms, Mr. Jiang will not receive any cash compensation**.** Instead, he will be eligible to receive equity-based compensation pursuant to a stock compensation arrangement that will become effective only after SpinCo begins trading on an OTC market. Mr. Jiang will also be eligible to participate in SpinCo's 2026 Incentive Plan. SpinCo, in its best judgment, determined that this compensation structure is appropriate and consistent with arrangements adopted by comparable companies in the industry.

The Company also intends to enter into an employment agreement with Mr. Eugene Jiang, appointing him as the Chief Financial Officer of SpinCo. Under the proposed terms, Mr. Jiang will not receive any cash compensation, and he will be eligible to receive equity-based compensation pursuant to a stock compensation arrangement that will become effective only after the Company begins trading on an OTC market. Mr. Jiang will also be eligible to participate in the Company's 2026 Incentive Plan. SpinCo has determined that the proposed compensation terms are appropriate and comparable to companies of similar size and stage in the industry.

*Chief Executive Officer Employment Agreement*

The Company intends to enter into an employment agreement with Mr. T.S. Jiang, appointing him as the Chief Executive Officer of SpinCo. Under the proposed terms, Mr. Jiang will not receive any cash compensation, and he will be eligible to receive equity-based compensation pursuant to a stock compensation arrangement that will become effective only after SpinCo beings trading on an OTC market. Mr. Jiang will also be eligible to participate in the Company's 2026 Incentive Plan. SpinCo believes that the proposed compensation terms are reasonable and aligned with the practices of comparable companies in the industry.

***2026 Incentive Plan***

Prior to the Spin-Off, we expect our Board to adopt, and ABVC, as our sole shareholder, to approve, the 2026 Incentive Plan of SpinCo for the benefit of certain of our current and future employees and other service providers ("**2026 Equity Incentive Plan**"). The following summary describes what we anticipate being the material terms of the 2026 Equity Incentive Plan.

When approved by ABVC and our Board, the full text of the Equity Incentive Plan will be included as an exhibit to a Current Report on Form 8-K filed with the SEC, and the following discussion is qualified in its entirety by reference to such text.

 

*Purpose of the Equity Incentive Plan*. The purpose of the 2026 Equity Incentive Plan would be to aid SpinCo in recruiting and retaining highly qualified employees and other service providers who are capable of assuring the future success of SpinCo. We expect that awards of stock-based compensation and opportunities for stock ownership in SpinCo will provide incentives to our employees and other service providers to exert their best efforts for the success of our business and thereby align their interests with those of our shareholders.

*Shares Available for Awards*. If the 2026 Equity Incentive Plan is approved by ABVC and our Board, it is expected that the maximum aggregate number of our Ordinary Shares that may be issued under all stock-based awards granted under the 2026 Equity Incentive Plan would be 10% of outstanding shares. In addition, it is expected that the 2026 Equity Incentive Plan will contain a limit on the number of Ordinary Shares available for grant in the form of incentive stock options to.

Under the 2026 Equity Incentive Plan, it is expected that SpinCo will have the flexibility to grant different types of equity compensation awards, including stock options, stock appreciation rights, restricted stock, deferred share units, and other awards based, in whole or in part, on the value of SpinCo equity, as well as cash-based awards. The grant, vesting, exercise, and settlement of awards granted under the 2026 Equity Incentive Plan may be subject to the satisfaction of time- or performance-based conditions, as determined at or after the date of grant of an award under the 2026 Equity Incentive Plan.

In the event of any change in corporate structure that affects our outstanding Ordinary Shares (e.g., a cash or stock dividend, stock split, reverse stock split, spin-off, recapitalization, merger, reorganization, etc.), our Compensation Committee shall make adjustments that it deems equitable or appropriate, in its sole discretion, including adjustments to the share limits described above, the number and type of shares subject to outstanding awards, or the purchase or exercise price of outstanding awards. In the case of any unusual or nonrecurring event (including events described in the preceding sentence) affecting the Company or changes in applicable laws, regulations, or accounting principles, our Compensation Committee may make adjustments to outstanding awards in order to prevent dilution or enlargement of the benefits intended to be provided under the 2026 Equity Incentive Plan.

Shares that are subject to awards that are paid in cash, terminate, lapse, or are canceled or forfeited would be available again for grant under the 2026 Equity Incentive Plan and would not be counted for purposes of the limits above. Shares that are reacquired by SpinCo with cash tendered in payment of the exercise price of an award and shares that are tendered or withheld in payment of all or part of the exercise price or tax withholding amount relating to an award will not be added back to the number of shares authorized under the 2026 Equity Incentive Plan. In addition, if stock appreciation rights are settled in shares upon exercise, the total number of shares actually issued upon exercise rather than the number of shares subject to the award would be counted against the number of shares authorized under the 2026 Equity Incentive Plan.

*Eligibility*. It is expected that employees and other service providers of SpinCo or its affiliates would be eligible to receive awards under the 2026 Equity Incentive Plan. Our directors will be eligible to participate in the 2026 Equity Incentive Plan for SpinCo.

*Administration*. It is expected that our Compensation Committee would have the authority to administer the 2026 Equity Incentive Plan, including the authority to select the persons who receive awards, determine the number of shares subject to the awards, and establish the terms and conditions of the awards, consistent with the terms of the 2026 Equity Incentive Plan. Subject to the expected provisions of the 2026 Equity Incentive Plan, our Compensation Committee may specify the circumstances under which the exercisability or vesting of awards may be accelerated or whether awards or amounts payable under awards may be deferred. Our Compensation Committee may waive or amend the terms of an award, consistent with the terms of the 2026 Equity Incentive Plan, but may not reprice a stock option or stock appreciation right, whether through amendment, cancelation and replacement, or exchange for cash or any other awards. Our Compensation Committee would have the authority to interpret the 2026 Equity Incentive Plan and establish rules for the administration of the 2026 Equity Incentive Plan. It is expected that the 2026 Equity Incentive Plan will provide that our Compensation Committee may delegate its powers and duties under the 2026 Equity Incentive Plan to one or more directors or other individuals as the committee deems to be advisable, except that only our Compensation Committee or our Board would have authority to grant and administer awards to executive officers.

The Board may also exercise the powers of our Compensation Committee with respect to the 2026 Equity Incentive Plan and awards granted thereunder at any time.

*Tax Consequences of Awards*. The following is a brief summary of the principal United States federal income tax consequences of awards and transactions under the 2026 Equity Incentive Plan for the employees and other service providers selected to participate in the 2026 Equity Incentive Plan (the "**Participants**") and the Company. This summary is not intended to be exhaustive and, among other things, does not describe local, state, or foreign tax consequences.

*Options and Stock Appreciation Rights*. A Participant will not recognize any income at the time a stock option or stock appreciation right is granted, nor will the Company be entitled to a deduction at that time. When a stock option is exercised, the Participant will recognize ordinary income in an amount equal to the excess of the fair market value of the shares received as of the date of exercise over the exercise price of the option. When a stock appreciation right is exercised, the Participant will recognize ordinary income in an amount equal to the cash received or, if the stock appreciation right is settled in shares, the shares received as of the date of exercise. The Company generally will be entitled to a corresponding tax deduction in the same time period and amount as the Participant recognizes income.

*Restricted Stock and Deferred Share Units*. A Participant will not recognize any income at the time of grant of a restricted stock unit or share of restricted stock (whether subject to time-based vesting or performance-based vesting), and the Company will not be entitled to a deduction at that time. The Participant will recognize ordinary income in an amount equal to the fair market value of the shares received or, if the restricted stock unit is paid in cash, the amount payable, upon settlement of a restricted stock unit. In the year in which shares of restricted stock are no longer subject to a substantial risk of forfeiture (i.e., in the year that the shares vest), the Participant will recognize ordinary income in an amount equal to the excess of the fair market value of the shares on the date of vesting over the amount, if any, the Participant paid for the shares. Under certain circumstances and if permitted by an individual award, a Participant may elect (within 30 days after being granted restricted stock) to recognize ordinary income in the year of receipt instead of the year of vesting. If such an election is made, the amount of income recognized by the Participant will be equal to the excess of the fair market value of the shares on the date of receipt over the amount, if any, the Participant paid for the shares. The Company generally will be entitled to a corresponding tax deduction in the same time period and amount as the Participant recognizes income.

*Other Types of Awards*. If other awards are granted under the 2026 Equity Incentive Plan, the tax consequences may differ from those described above for stock options, stock appreciation rights, restricted stock, and deferred share units. As a general matter, the Company typically would be entitled to a tax deduction in respect of any such compensatory awards in the same time period and amount as the Participant recognizes income in respect of such awards.

*Withholding of Taxes*. The Company has the right to require, prior to the issuance or delivery of shares in settlement of any award, the Participant to pay any taxes required by law.

**SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT**

As of the date of this information statement, ABVC beneficially owns all of our outstanding Ordinary Shares. After the Spin-Off, all of our Ordinary Shares will be held by ABVC, current ABVC shareholders, and certain of our direct shareholders. The following table provides information regarding the anticipated beneficial ownership of our Ordinary Shares by:

● each of our shareholders whom we believe (based on the assumptions described below) will beneficially own more than 5% of our outstanding shares;

● each of our directors;

● each of our named executive officers; and

● all of our directors and executive officers as a group.

Except as otherwise noted below, we based the share amounts on each person's beneficial ownership as if the Share Distribution occurred, based on a ratio of [ ] Ordinary Shares for each share of ABVC Common Stock.

Except as otherwise noted in the footnotes below, each person or entity identified in the table has sole voting and investment power with respect to the securities beneficially owned.

Immediately following the Spin-Off, we estimate that [ ] Ordinary Shares will be issued and outstanding, based on the approximately [ ] shares of ABVC Common Stock outstanding on [ ], 2026. The actual number of our Ordinary Shares that will be outstanding following the completion of the Spin-Off will be determined on [ ], 2026. The number of our Ordinary Shares beneficially owned by each shareholder, director, or executive officer is determined according to the rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other purpose. The mailing address for each of the directors and executive officers is 44370 Old Warm Springs Blvd., Fremont, CA 94538, unless specified otherwise.

---

| | | |
|:---|:---|:---|
| **Name and Address of Beneficial Owners of SpinCo After the Spin-Off** | **Amount and <br> Nature of<br> Beneficial <br> Ownership of<br> Ordinary <br> Shares** | **Percentage** |
| Dr. T.S. Jiang <sup>(1)</sup> | [] | [] |
| Eugene Jiang <sup>(2)</sup> | [] | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[] |
| Dr. Uttam Patil <sup>(3)</sup> | [] | [] |
| Shuling Jiang <sup>(4)</sup> | [] | [] |
| Yu-Ming (Francis) Chung <sup>(5)</sup> | [] | [] |
| Toru Seo | [] | [] |
| **Directors and Executive Officers as a Group (6 persons)** | [] | [] |
| *5% Beneficial Owner* |  |  |
| **ABVC BioPharma, Inc.<sup>(6)</sup>** | [] | 90% |

---

\* less than 1%.

(1) Dr. T.S. Jiang is the Chief Scientific Officer, Chief Strategy Officer, and a Director of ABVC.

(2) Eugene Jiang is the Chairman of the Board and Chief Business Officer of ABVC.

(3) Dr. Uttam Patil is the Chief Executive Officer and Interim CFO of ABVC.

(4) Shuling Jiang is an Independent Director of ABVC.

(5) Yu-Ming (Francis) Chung is an Independent Director of ABVC.

(6) Eugene
Jiang maintains sole voting control over the shares held by ABVC, the principal office address of which is 44370 Old Warm Springs Blvd.,
Fremont, CA, United States.

**CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS**

**Relationship with ABVC**

Prior to the completion of the Spin-Off, all of our issued Ordinary Shares are held by ABVC. Following the completion of the Spin-Off, it is not expected that ABVC will own [ ]% of our Ordinary Shares. See "*Risk Factors—Risks Related to the Spin-Off*" and "*The Spin-Off*."

Following the Spin-Off and distribution, SpinCo and ABVC will operate separately, each as an independent public company. In connection with the Spin-Off, SpinCo and ABVC, or their respective subsidiaries, will enter into certain agreements that will effectuate the Spin-Off and govern the relationship between SpinCo and ABVC after the Spin-Off.

Additionally, all of the persons disclosed herein to be our officers and directors after the Spin-Off are current directors and executive officers of ABVC, our parent company.

The following is a summary of the terms of the material agreements that we intend to enter into with ABVC prior to or concurrently with the completion of the Spin-Off, forms of which are filed as exhibits to the registration statement on Form 10 of which this information statement is a part. These summaries set forth the terms of the agreements that we believe are material to SpinCo, are not complete and are qualified in their entirety by reference to the full text of such agreements. The terms of the agreements described below that will be in effect following the Spin-Off and distribution have not yet been finalized. Changes to these agreements, some of which may be material, may be made prior to the Spin-Off and distribution.

**Agreements with ABVC**

In order to govern the ongoing relationships between us and ABVC after the Spin-Off and to facilitate an orderly transition, we and ABVC intend to enter into agreements providing for various rights following the Spin-Off, and under which we and ABVC will agree to indemnify each other against certain liabilities arising from our respective businesses. The following summarizes the terms of the material agreements we expect to enter into with ABVC.

***Separation and Distribution Agreement***

We intend to enter into a Separation and Distribution Agreement with ABVC prior to the distribution of our Ordinary Shares to ABVC shareholders. The Separation and Distribution Agreement will set forth our agreements with ABVC regarding the principal actions to be taken in connection with the Spin-Off, including the distribution of 10% of our outstanding Ordinary Shares to holders of ABVC Common Stock on a pro rata basis, with ABVC retaining the remaining 90% of our outstanding Ordinary Shares following the distribution. The Separation and Distribution Agreement will identify assets to be transferred, liabilities to be assumed and contracts to be assigned to each of SpinCo and ABVC as part of the Spin-Off, and it will provide for when and how these transfers, assumptions and assignments will occur.

*Transfer of Assets and Assumption of Liabilities.* The Separation and Distribution Agreement will identify the Subsidiary Assets to be retained by or transferred to us and will describe when and how these transfers will occur, though certain transfers may have already occurred prior to the parties' entering into the Separation and Distribution Agreement. The Separation and Distribution Agreement will provide for those transfers of assets that are necessary in connection with the Spin-Off so that we retain the assets necessary to operate our business. To the extent any Subsidiary Assets are held in the name of ABVC at the time of the Spin-Off, ABVC will transfer, contribute, assign, and convey to us all of ABVC's right, title, and interest in and to such assets. If the transfer of any Subsidiary Assets cannot be consummated prior to the effective time of the distribution for any reason, ABVC will hold such assets for our use and benefit until the transfer can be effected.

Except as otherwise set forth in the Separation and Distribution Agreement or any ancillary agreement, each party to the Separation and Distribution Agreement will assume the liability for, and control of, all pending, threatened and future legal matters related to its own business or its assumed or retained liabilities. The allocation of liabilities with respect to taxes is solely covered by the tax matters agreement.

*Further Assurances.* Each party will agree to use its reasonable best efforts, prior to, on and after the distribution date, to take, or to cause to be taken, all actions, and to do, or to cause to be done, all things reasonably necessary under applicable law or contractual obligations to consummate and make effective the transactions contemplated by the Separation and Distribution Agreement and the ancillary agreements. For the avoidance of doubt, nothing in the Separation and Distribution Agreement will require ABVC to provide any ongoing operational, developmental, regulatory, scientific, or commercial services to us following the effective time of the distribution. ABVC's obligations under the further assurances provision are solely ministerial and incidental to the consummation of the Spin-Off.

*Conduct of Business. During the period from the date of the Separation and* Distribution Agreement until the earlier of the effective time of the distribution or the termination of the Separation and Distribution Agreement (the "Interim Period"), we will be required to conduct and operate our business in the ordinary course of business in all material respects, except as expressly contemplated by the Separation and Distribution Agreement or as consented to in writing by ABVC. During the Interim Period, we will be required to, among other things: (i) preserve and protect our assets in the ordinary course of business; (ii) not sell, transfer, assign, license, pledge, encumber, or otherwise dispose of any of our assets without ABVC's prior written consent; (iii) promptly notify ABVC of any event or circumstance that would reasonably be expected to have a material adverse effect on our business; and (iv) use commercially reasonable efforts to satisfy all conditions to the Spin-Off.

*The Distribution.* The Separation and Distribution Agreement will govern the rights and obligations of the parties with respect to the distribution and certain actions that must occur prior to the distribution. On the Share Distribution Date, ABVC will deliver to the distribution agent stock certificates representing 10% of our outstanding Ordinary Shares, and the distribution agent will distribute to each holder of ABVC Common Stock on the Record Date the number of our Ordinary Shares equal to [ ] Ordinary Shares for each share of ABVC Common Stock held of record as of the close of business on [ ], 2026, the Record Date for the Share Distribution. No fractional shares will be issued; in the event a holder of ABVC Common Stock would otherwise be entitled to a fractional Ordinary Share, the number of Ordinary Shares such holder will receive will be rounded up to the nearest whole number of Ordinary Shares. ABVC will have the sole and absolute discretion to determine (and change) the terms of, and whether to proceed with, the distribution and, to the extent it determines to proceed, to determine the record date for the distribution, the Share Distribution Date, and the distribution ratio.

*Conditions.* The Separation and Distribution Agreement will provide that the distribution is subject to several conditions that must be satisfied (or waived by ABVC, in its sole discretion), including: (i) the Form 10 shall have been filed with the Commission with no stop order in effect and all Commission comments cleared; (ii) an information statement satisfying the requirements of the Commission shall have been filed with the Commission and delivered to all holders of ABVC Common Stock; (iii) all required Governmental Approvals and other consents necessary to consummate the Spin-Off shall have been obtained; (iv) no order, injunction, or decree preventing the consummation of the Spin-Off shall be in effect; (v) the Board of Directors of ABVC shall have authorized and approved the Spin-Off and not withdrawn such authorization; (vi) no events or developments shall have occurred that, in the sole discretion of the Board of Directors of ABVC, would result in the Spin-Off having a material adverse effect on ABVC, its shareholders, or its creditors; and (vii) the ancillary agreements shall have been executed by each party thereto. ABVC may, in its sole discretion, determine the Record Date, the Share Distribution Date and the distribution ratio or other terms of the distribution and may at any time prior to the completion of the distribution decide to abandon or modify the distribution. For further information regarding these conditions, see "*The Spin-Off—Conditions to the Spin-Off*."

*Indemnification.* The Separation and Distribution Agreement will provide for cross-indemnities that, except as otherwise provided in the Separation and Distribution Agreement, are principally designed to place financial responsibility for the obligations and liabilities allocated to us under the Separation and Distribution Agreement with us and financial responsibility for the obligations and liabilities allocated to ABVC under the Separation and Distribution Agreement with ABVC. Specifically, following the distribution date and for a period of one (1) year thereafter, we will indemnify ABVC and its affiliates against liabilities arising from, among other things, our failure to discharge our liabilities after the distribution date, any untrue or misleading statement in the Form 10, any fraud or willful misconduct by us, and any breach by us of the Separation and Distribution Agreement or any ancillary agreement. ABVC will indemnify us and our affiliates against liabilities arising from, among other things, ABVC's failure to discharge its liabilities arising from acts or omissions prior to the effective time, and any breach by ABVC of the Separation and Distribution Agreement or any ancillary agreement, as well as any liabilities incurred by us or our minority shareholders arising from ABVC's exercise of its rights as our controlling shareholder in a manner that constitutes fraud, willful misconduct, gross negligence, or a breach of any fiduciary duty owed to us or our minority shareholders. The Separation and Distribution Agreement will also specify procedures with respect to claims subject to indemnification and related matters. Indemnification with respect to taxes will be governed by the tax matters agreement described below.

*Term/Termination.* Prior to the distribution, ABVC will have the unilateral right to terminate, modify or amend the terms of the Separation and Distribution Agreement and amend, modify, or abandon the distribution. After the effective time of the distribution, the term of the Separation and Distribution Agreement is indefinite, and it may only be terminated with the prior written consent of both ABVC and us.

*Other Matters Governed by the Separation and Distribution Agreement.* Other matters governed by the Separation and Distribution Agreement include, without limitation, access to financial and other information, confidentiality, and access to, and provision of, records. In addition, the Separation and Distribution Agreement includes provisions governing the post-distribution relationship between ABVC and us for so long as ABVC holds a majority of our outstanding Ordinary Shares, including requirements that any transactions between ABVC and us be on arm's-length terms, that transactions involving consideration in excess of $100,000 require the prior approval of a majority of the independent members of our Board of Directors, that ABVC present to us any business opportunity relating primarily to our business before pursuing it for its own account, and that ABVC not take any action to cause us to issue additional equity securities at below fair market value or to effect any transaction designed to eliminate or materially reduce the ownership interest of our minority shareholders without the requisite approvals.

 ***Transition Services Agreement***

*ABVC Transitional Services*. We and ABVC will enter into a transitional services agreement in connection with the Spin-Off pursuant to which ABVC will provide, or coordinate the provision by others, on an interim, transitional basis, various services to us as set forth in Exhibit A to the Transition Services Agreement, including accounting, financial reporting and consolidation, and the services of a financial and operations principal. The Transition Services Agreement will become operative as of the completion of the Spin-Off and the Services will continue for an initial term of six (6) months from the date of the distribution, which may be extended thereafter for subsequent three (3) month terms by mutual agreement of the parties. We may terminate the Services at any time and for any reason on not less than ten (10) business days' prior written notice to ABVC. We will pay ABVC a flat monthly fee for the Services as set forth in the Transition Services Agreement.

***Tax Matters Agreement***

We intend to enter into a Tax Matters Agreement with ABVC prior to or concurrently with the completion of the Spin-Off. The Tax Matters Agreement will govern ABVC's and our respective rights, responsibilities, and obligations with respect to tax matters arising prior to, as a result of, and after the Distribution. The Parties acknowledge and agree that the Distribution is not intended to qualify as a tax-free transaction under Section 355(a) of the Internal Revenue Code of 1986, as amended (the "**Code**"), and shall be treated as a taxable transaction for U.S. federal income tax purposes.

The Tax Matters Agreement will allocate liability for taxes between the Parties as follows: we will be liable for any unpaid Subsidiary Federal Income Tax Liability and Subsidiary State Tax Liability, whether arising before, at, or after the Distribution; and ABVC will be liable for all other tax liabilities. Each Party will agree to indemnify, defend, and hold harmless the other Party, its subsidiaries, and their respective directors, officers, employees, agents, successors, and assigns from and against their respective tax liabilities. With respect to refunds, if either Party receives a refund, offset, or credit attributable to taxes for which the other Party is liable, the receiving Party will remit such amount to the other Party within thirty (30) days of receipt, net of any tax liability and expenses incurred in connection with such receipt. The Tax Matters Agreement will also govern the preparation and filing of tax returns, including Parent's right to prepare and file consolidated Federal Income Tax Returns and Combined State Tax Returns, and will require each Party and their respective personnel to cooperate fully in connection with the preparation and review of tax returns and any examinations by tax authorities. The Tax Matters Agreement will specify procedures with respect to claims for indemnification, including notice requirements, the right of the indemnifying party to control relevant tax examinations, and the obligation to make indemnification payments on an after-tax basis. Any and all existing tax sharing agreements or arrangements between the Parent Companies and the Subsidiary Companies will be terminated as of the Distribution Date, and the Tax Matters Agreement will serve as the sole tax sharing agreement between the Parties following the Distribution. Each of ABVC and us will be required to preserve and keep all tax records relating to pre-distribution periods and straddle periods until the later of the expiration of any applicable statutes of limitations or seven (7) years after the Distribution Date, and will make such records available to the other Party for inspection and copying during normal business hours upon reasonable notice. In addition, each Party will agree not to take or fail to take any action that management knows, or should know, is reasonably likely to contravene any agreement with a tax authority entered into prior to the Distribution Date.

***Employee Matters Agreement***

We intend to enter into an Employee Matters Agreement with ABVC prior to or concurrently with the completion of the Spin-Off. As of the date of the Employee Matters Agreement, we will have no employees, and all employees whose services relate to our business are currently employed by ABVC. The Employee Matters Agreement will govern the transfer of certain employees from ABVC to us and will allocate between ABVC and us assets, liabilities, and responsibilities with respect to employee compensation, benefits, labor, and other employment matters. Among other things, the Employee Matters Agreement will address the following:

● the transfer of employment of employees whose services relate primarily to our business (the "**Subsidiary Employees**") from ABVC to us at or prior to the effective time of the Spin-Off, and the continued employment by ABVC of employees who will continue to serve ABVC following the distribution (the "**Continuing Employees** "), including the assumption by us of all employment-related liabilities with respect to Subsidiary Employees and former employees whose last employment with ABVC was primarily related to our business;

● the allocation of assets and liabilities with respect to employee benefit plans, including: (i) the cessation of Subsidiary Employees' participation in ABVC's retirement plan and health and welfare benefit plans as of the effective time, and the establishment by us of a new 401(k) retirement plan and group health and welfare benefit plans for Subsidiary Employees; (ii) the transfer of Subsidiary Employees' account balances under ABVC's 401(k) plan to our new retirement plan; (iii) the assumption by us of COBRA obligations with respect to Subsidiary Employees and former employees; (iv) the acceleration of vesting of all outstanding equity awards granted under ABVC's equity compensation plans as of the effective time, with ABVC remaining responsible for the associated compensation costs; and (v) the assumption by us of all equity compensation plan obligations following the distribution; and

● workers' compensation obligations (with us assuming responsibility for Workers' Compensation Events occurring on or after the effective time and ABVC retaining responsibility for events occurring prior thereto), severance obligations with respect to Subsidiary Employees arising on or after the effective time, the transfer of accrued vacation and sick leave balances to us, compliance with WARN Act obligations, and payroll tax reporting and related matters.

**Policy and Procedures Governing Related Party Transactions** 

Prior to the completion of the Spin-Off, our Board plan to adopt a written policy regarding the review, approval, and ratification of transactions with related persons. We anticipate that this policy will provide that our Nominating and Governance Committee review each of SpinCo's transactions in which any "related person" had, has, or will have a direct or indirect material interest. In general, "related persons" are our directors, director nominees, executive officers, and shareholders beneficially owning more than 5% of our outstanding Ordinary Shares and immediate family members or certain affiliated entities of any of the foregoing persons. We expect that our Nominating and Governance Committee will approve or ratify only those transactions that are fair and reasonable to SpinCo and in our and our shareholders' best interests.

**DESCRIPTION OF OUR ORDINARY SHARES**

**General**

We are a Cayman Islands exempted company with limited liability and our affairs are governed by our Memorandum and Articles of Association, the Companies Act of the Cayman Islands (As Revised) (the "**Cayman Companies Act**") and the rules and regulations of the stock exchange on which are shares are traded.

The following summarizes information concerning our Ordinary Shares, including material provisions of our Memorandum and Articles of Association, and certain provisions of Cayman Islands law. You are encouraged to read the forms of our Memorandum and Articles of Association, which are filed as exhibits to our Registration Statement on Form 10, of which this information statement is a part, for greater detail with respect to these provisions.

**Distribution of Securities**

During the past three years, we have not sold any securities, including sales of reacquired securities, new issues, securities issued in exchange for property, services or other securities, and new securities resulting from the modification of outstanding securities that were not registered under the Securities Act.

**Authorized Share Capital**

Immediately following the Spin-Off, our authorized share capital will be US$50,000 consisting of 500,000,000 shares of a nominal or par value of US$0.0001 per share ("**Ordinary Shares**").

**Ordinary Shares**

***Shares Outstanding***

Immediately following the Spin-Off, we estimate that approximately [ ] Ordinary Shares will be issued and outstanding, based on approximately [ ] shares of ABVC Common Stock outstanding as of [ ], 2026. The actual number of Ordinary Shares outstanding immediately following the Spin-Off will depend on the actual number of shares of ABVC Common Stock outstanding on the Record Date and will reflect any issuance of new shares or exercise of outstanding options, or any equity rights pursuant to any warrants.

***Dividends***

The holders of our Ordinary Shares are entitled to such dividends as may be declared by our Board of Directors subject to the Cayman Companies Act and to our Memorandum and Articles of Association. The timing, declaration, amount, and payment of future dividends will depend on our financial condition, earnings, capital requirements, and debt service obligations, as well as legal requirements, regulatory constraints, industry practice and other factors that our Board deems relevant. Our Board will make all decisions regarding our payment of dividends from time to time in accordance with applicable law. See "*Dividend Policy*."

***Voting Rights***

The holders of our Ordinary Shares will be entitled to one vote for each share held of record on all matters submitted to a vote of the shareholders and shall be entitled to notice of any shareholders' meeting.

Voting at any shareholders' meeting is by show of hands unless a poll is demanded by one or more shareholders present in person or by proxy holding not less than fifteen percent of the capital of the Company entitled to vote. Actions that may be taken at a general meeting also may be taken by a unanimous resolution of the shareholders in writing.

No business shall be transacted at any general meeting unless a quorum of members is present at the time when the meeting proceeds to business; one or more members holding in the aggregate not less than one-third of the total issued Ordinary Shares of the Company present in person or by proxy and entitled to vote shall be a quorum.

An ordinary resolution to be passed at a general meeting requires the affirmative vote of a majority of the members entitled to vote there-at.

A special resolution to be passed at a general meeting requires the affirmative vote of two-thirds majority of the members entitled to vote there-at. A special resolution of members is required to, amongst other things, change the name of the Company, approve a merger, wind up the Company and amend the Memorandum and Articles of Association.

***Transfer of Ordinary Shares***

Shareholders may transfer all or any of their Ordinary Shares by an instrument of transfer in the usual or common form or any other form approved by our Board or in a form prescribed by the stock exchange on which our Ordinary Shares are then listed.

Our Board may, in their absolute discretion, decline to register any transfer of Ordinary Shares. The Board may also decline to register any transfer of Ordinary Shares if the instrument of transfer is not accompanied by the certificate covering the shares to which it relates or any other evidence as the Board may reasonably require to prove the right of the transferor to transfer the shares.

If our directors refuse to register a transfer, they shall, within one month after the date on which the transfer was lodged, send to the transferee notice of such refusal.

The registration of transfers may also be suspended during the fourteen days immediately preceding the annual general meeting in each year.

***Winding-Up/Liquidation***

On a return of capital on winding up or otherwise (other than on conversion, redemption, or purchase of shares), a liquidator may be appointed to determine how to distribute the assets among the holders of the Ordinary Shares. If our assets available for distribution are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by our shareholders in proportion to the capital paid up; a similar basis will be employed if the assets are more than sufficient to repay the whole of the capital at the commencement of the winding up.

***Calls on Ordinary Shares and Forfeiture of Ordinary Shares***

The directors may from time to time make calls upon shareholders for any amounts unpaid on their Ordinary Shares in a notice served to such shareholders at least 14 days prior to the specified time of payment. The shares that have been called upon and remain unpaid on the specified time are subject to forfeiture.

***Anti-Takeover Provisions*** 

Some provisions of our Memorandum and Articles of Association may discourage, delay, or prevent a change of control of our Company or management that shareholders may consider favorable, including provisions that:

● authorize our Board to issue preference shares in one or more series and to designate the price, rights, preferences, privileges, and restrictions of such preference shares subject to a re-classification of the authorized share capital of the Company to be approved by our shareholders; and

● limit the ability of shareholders to requisition and convene general meetings of shareholders.

However, under Cayman Islands law, our directors may only exercise the rights and powers granted to them under our currently effective memorandum and articles of association for a proper purpose and for what they believe in good faith to be in the best interests of our Company.

***Exempted Company***

We are an exempted company with limited liability under the Cayman Companies Act. The Cayman Companies Act distinguishes between ordinary resident companies and exempted companies. A Cayman Islands exempted company:

● is a company that conducts its business mainly outside of the Cayman Islands;

● is exempted from certain requirements of the Cayman Companies Act, including the filing an annual return of its shareholders with the Registrar of Companies;

● does not have to make its register of members open for inspection;

● does not have to hold an annual general meeting;

● may issue negotiable or bearer shares or shares with no par value (subject to the provisions of the Cayman Companies Act);

● may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance); and

● may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands.

"Limited liability" means that the liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which a court may be prepared to pierce or lift the corporate veil).

***Register of Members***

Under Cayman Islands law, we must keep a register of members and there should be entered therein:

● the names and addresses of the members, a statement of the shares held by each member, and of the amount paid or agreed to be considered as paid, on the shares of each member;

● the date on which the name of any person was entered on the register as a member; and

● the date on which any person ceased to be a member.

Under Cayman Islands law, the register of members of our Company is prima facie evidence of the matters set out therein (i.e. the register of members will raise a presumption of fact on the matters referred to above unless rebutted) and a member registered in the register of members is deemed as a matter of Cayman Islands law to have legal title to the shares as set against its name in the register of members. Once our register of members has been updated, the shareholders recorded in the register of members are deemed to have legal title to the shares set against their name.

If the name of any person is incorrectly entered in, or omitted from, our register of members, or if there is any default or unnecessary delay in entering on the register the fact of any person having ceased to be a member of our Company, the person or member aggrieved (or any member of our Company or our Company itself) may apply to the Cayman Islands Grand Court for an order that the register be rectified, and the Court may either refuse such application or it may, if satisfied of the justice of the case, make an order for the rectification of the register.

***Material Differences between U.S. Corporate Law and Cayman Islands Corporate Law***

Cayman Islands companies are governed by the Cayman Companies Act. The Cayman Companies Act is modeled on English law but does not follow recent English law statutory enactments, and differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of the material differences between the provisions of the Cayman Companies Act applicable to us and the laws applicable to companies incorporated in the United States and their shareholders.

*Mergers and Similar Arrangements*. In certain circumstances, the Cayman Companies Act allows for mergers or consolidations between two Cayman Islands companies, or between a Cayman Islands company and a company incorporated in another jurisdiction (provided that is facilitated by the laws of that other jurisdiction).

Where the merger or consolidation is between two Cayman Islands companies, the directors of each company must approve a written plan of merger or consolidation containing certain prescribed information. That plan or merger or consolidation must then be authorized by either (i) a special resolution of the shareholders of each company; and (ii) such other authorization, if any, as may be specified in such constituent company's articles of association. No shareholder resolution is required for a merger between a parent company (i.e., a company that holds issued shares that together represent 90% of the votes at a general meeting of the subsidiary company) and its subsidiary company, provided the parent company is the surviving entity and a copy of the plan of merger is given to every member of each subsidiary company to be merged unless that member agrees otherwise. The consent of each holder of a fixed or floating security interest of a constituent company must be obtained, unless the court waives such requirement. If the Cayman Islands Registrar of Companies is satisfied that the requirements of the Cayman Companies Act (which includes certain other formalities) have been complied with, the Registrar of Companies will register the plan of merger or consolidation.

Where the merger or consolidation involves a foreign company, the procedure is similar, save that with respect to the foreign company, the directors of the Cayman Islands company are also required to make a declaration to the effect that, having made due enquiry, they are of the opinion that certain requirements have been met, including the following requirements: (i) that the merger or consolidation is permitted or not prohibited by the constitutional documents of the foreign company and by the laws of the jurisdiction in which the foreign company is incorporated, and that those laws and any requirements of those constitutional documents have been or will be complied with; (ii) that no petition or other similar proceeding has been filed and remains outstanding or order made or resolution adopted to wind up or liquidate the foreign company in any applicable jurisdictions; (iii) that no receiver, trustee, administrator or other similar person has been appointed in any jurisdiction and is acting in respect of the foreign company, its affairs or its property or any part thereof; (iv) that no scheme, order, compromise or other similar arrangement has been entered into or made in any jurisdiction whereby the rights of creditors of the foreign company are and continue to be suspended or restricted; and (v) there is no other reason why it would be against the public interest to permit the merger or consolidation.

Where the surviving company is the Cayman Islands exempted company, the directors of the Cayman Islands exempted company are further required to make a declaration to the effect that, having made due enquiry, they are of the opinion that the following requirements have been met: (i) that the foreign company is able to pay its debts as they fall due and that the merger or consolidation is bona fide and not intended to defraud unsecured creditors of the foreign company; (ii) that in respect of the transfer of any security interest granted by the foreign company to the surviving or consolidated company (A) consent or approval to the transfer has been obtained, released or waived; (B) the transfer is permitted by and has been approved in accordance with the constitutional documents of the foreign company; and (C) the laws of the jurisdiction of the foreign company with respect to the transfer have been or will be complied with; and (iii) that the foreign company will, upon the merger or consolidation becoming effective, cease to be incorporated, registered or exist under the laws of the relevant foreign jurisdiction.

The Cayman Companies Act provides for a right of dissenting shareholders to be paid the fair value of their shares upon their dissenting to the merger or consolidation in certain circumstances if they follow a prescribed procedure. In essence, where such rights apply, that procedure is as follows: (i) the shareholder must give his written objection to the merger or consolidation to the constituent company before the vote on the merger or consolidation, including a statement that the shareholder proposes to demand payment for their shares if the merger or consolidation is authorized by the vote; (ii) within 20 days following the date on which the merger or consolidation is authorized by the shareholders, the constituent company must give written notice to each shareholder who made a written objection; (iii) a shareholder must within 20 days following receipt of such notice from the constituent company, give the constituent company a written notice of his intention to dissent including, among other details, a demand for payment of the fair value of their shares; (iv) within seven days following the date of the expiration of the period set out in paragraph (ii) above or seven days following the date on which the plan of merger or consolidation is filed, whichever is later, the constituent company, the surviving company or the consolidated company must make a written offer to each dissenting shareholder to purchase their shares at a price that the company determines is the fair value and if the company and the shareholder agree the price within 30 days following the date on which the offer was made, the company must pay the shareholder such amount; and (v) if the company and the shareholder fail to agree on a price within such 30 day period, within 20 days following the date on which such 30 day period expires, the company must (and any dissenting shareholder may) file a petition with the Grand Court of the Cayman Islands to determine the fair value of all dissenting shares and such petition must be accompanied by a list of the names and addresses of the dissenting shareholders with whom agreements as to the fair value of their shares have not been reached by the company. At the hearing of that petition, the court has the power to determine the fair value of the shares together with a fair rate of interest, if any, to be paid by the company upon the amount determined to be the fair value. Any dissenting shareholder whose name appears on the list filed by the company may participate fully in all proceedings until the determination of fair value is reached. A shareholder who dissents must do so in respect of all shares that that person holds in the constituent company. Upon the giving of a notice of dissent under paragraph (iii) above, the shareholder to whom the notice relates shall cease to have any of the rights of a shareholder except the right to be paid the fair value of that person's shares and certain rights specified in the Cayman Companies Act. These rights of a dissenting shareholder are not available in certain circumstances, for example, to dissenting shareholders holding shares of any class in respect of which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the relevant date, where the consideration for such shares to be contributed are shares of any company listed on a national securities exchange or shares of the surviving or consolidated company.

Moreover, Cayman Islands law has separate statutory provisions that facilitate the reconstruction or amalgamation of companies in certain circumstances, commonly referred to in the Cayman Islands as a "scheme of arrangement," which may be tantamount to a merger. Schemes of arrangement will generally be more suited for complex mergers or other transactions involving widely held companies. In the event that a merger was sought pursuant to a scheme of arrangement (the procedures for which are more rigorous and take longer to complete than the procedures typically required to consummate a merger in the United States), the arrangement in question must be approved (i) in relation to a compromise or arrangement between a company and its creditors or any class of them, a majority in number of such creditors or class of creditors with whom the arrangement is to be made and who must in addition represent 75% in value of such creditors or class of creditors, as the case may be, that are present and voting either in person or by proxy at a meeting summoned for that purpose; and (ii) in relation to a compromise or arrangement between a company and its shareholders or any class of them, shareholders who represent 75% in value of the company's shareholders or class of shareholders, as the case may be, that are present and voting either in person or by proxy at a meeting summoned for that purpose. The convening of the meetings and subsequently the terms of the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder would have the right to express to the court the view that the transaction should not be approved, the court can be expected to approve the arrangement if it satisfies itself that:

● we are not proposing to act illegally or beyond the scope of our corporate authority and the statutory provisions as to majority vote have been complied with;

● the shareholders have been fairly represented at the meeting in question;

● the arrangement is such as a businessman would reasonably approve; and

● the arrangement is not one that would more properly be sanctioned under some other provision of the Cayman Companies Act or that would amount to a "fraud on the minority."

If a scheme of arrangement or takeover offer (as described below) is approved, any dissenting shareholder would have no rights comparable to dissenters' rights or appraisal rights (providing rights to receive payment in cash for the judicially determined value of the shares), which would otherwise ordinarily be available to dissenting shareholders of United States corporations.

*Squeeze-out Provisions*. When a takeover offer is made and accepted by holders of 90% in value of the shares to whom the offer relates within four months, the offeror may, within a two-month period after the expiration of the initial four-month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands, but this is unlikely to succeed unless there is evidence of fraud, bad faith, collusion, or inequitable treatment of the shareholders.

Further, transactions similar to a merger, reconstruction and/or an amalgamation may in some circumstances be achieved through means other than these statutory provisions, such as a share capital exchange, asset acquisition or control, or through contractual arrangements of an operating business.

*Shareholders' Suits*. Conyers, Dill& Pearman LLP, our Cayman Islands legal counsel, is not aware of any reported class action having been brought in a Cayman Islands court. Derivative actions have been brought in the Cayman Islands courts, and the Cayman Islands courts have confirmed the availability of such actions. In most cases, we will be the proper plaintiff in any claim based on a breach of duty owed to us, and a claim against (for example) our officers or directors usually may not be brought by a shareholder. However, based both on Cayman Islands authorities and on English authorities, which would in all likelihood be of persuasive authority and be applied by a court in the Cayman Islands, exceptions to the foregoing principle apply in circumstances in which:

● a company is acting, or proposing to act, illegally or beyond the scope of its authority;

● the act complained of, although not beyond the scope of the authority, could be effected if duly authorized by more than the number of votes which have actually been obtained; or

● those who control the company are perpetrating a "fraud on the minority."

A shareholder may have a direct right of action against us where the individual rights of that shareholder have been infringed or are about to be infringed.

*Enforcement of Civil Liabilities*. We are registered under the laws of the Cayman Islands as an exempted company. We are registered in the Cayman Islands because of certain benefits associated with being a Cayman Islands company, such as political and economic stability, an effective judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional and support services. However, the Cayman Islands have a less prescriptive body of securities laws as compared to the United States and some U.S. states, such as Delaware, have more fulsome and judicially interpreted bodies of corporate law than the Cayman Islands.

We have been advised by Conyers, Dill & Pearman LLP, our Cayman Islands legal counsel, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature. The Cayman Islands court will not enforce criminal fines and tax judgments and judgments that are contrary to Cayman Islands public policy. However, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, and or be of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

Substantially all of our assets are located outside the United States. In addition, all or a substantial portion of the assets of the members of our board of directors and of our officers are located outside the United States. As a result, it may be difficult for investors to effect service of process within the United States upon us or these persons, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States.

Notwithstanding the foregoing, we cannot assure you that confirmation of any judgment will be obtained, or that the process described above can be conducted in a timely manner.

***Limitation on Liability and Indemnification of Officers and Directors***

Cayman Islands law does not limit the extent to which a company's memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against willful default, willful neglect, actual fraud, or the consequences of committing a crime. Our memorandum and articles of association provide that our officers and directors will be indemnified by us to the fullest extent permitted by law, as it now exists or may in the future be amended, including for any liability incurred in their capacities as such, except through their own actual fraud, willful default, or willful neglect.

We expect to purchase a policy of directors' and officers' liability insurance that insures our officers and directors against the cost of defense, settlement, or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors. We also intend to enter into indemnity agreements with them.

Our indemnification obligations may discourage shareholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our shareholders. Furthermore, a shareholder's investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions. We believe that these provisions, the insurance, and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

**Cayman Islands Data Protection** 

We have certain duties under the Data Protection Act (as revised) of the Cayman Islands, or the DPA, based on internationally accepted principles of data privacy.

***Privacy Notice***

This privacy notice puts our shareholders on notice that through your investment into us you will provide us with certain personal information which constitutes personal data within the meaning of the DPA, or personal data.

***Investor Data***

We will collect, use, disclose, retain, and secure personal data to the extent reasonably required only and within the parameters that could be reasonably expected during the normal course of business. We will only process, disclose, transfer, or retain personal data to the extent legitimately required to conduct our activities of on an ongoing basis or to comply with legal and regulatory obligations to which we are subject. We will only transfer personal data in accordance with the requirements of the DPA and will apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental loss, destruction, or damage to the personal data.

In our use of this personal data, we will be characterized as a "data controller" for the purposes of the DPA, while our affiliates and service providers who may receive this personal data from us in the conduct of our activities may either act as our "data processors" for the purposes of the DPA or may process personal information for their own lawful purposes in connection with services provided to us.

We may also obtain personal data from other public sources. Personal data includes, without limitation, the following information relating to a shareholder and/or any individuals connected with a shareholder as an investor: name, residential address, email address, contact details, corporate contact information, signature, nationality, place of birth, date of birth, tax identification, credit history, correspondence records, passport number, bank account details, source of funds details and details relating to the shareholder's investment activity.

***Who this Affects***

If you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in relation your investment in us, this will be relevant for those individuals and you should transit the content of this Privacy Notice to such individuals or otherwise advise them of its content.

***How We May Use a Shareholder's Personal Data***

We may, as the data controller, collect, store and use personal data for lawful purposes, including, in particular: (i) where this is necessary for the performance of our rights and obligations under any agreements; (ii) where this is necessary for compliance with a legal and regulatory obligation to which we are or may be subject (such as compliance with anti-money laundering and FATCA/CRS requirements); and/or (iii) where this is necessary for the purposes of our legitimate interests and such interests are not overridden by your interests, fundamental rights or freedoms.

Should we wish to use personal data for other specific purposes (including, if applicable, any purpose that requires your consent), we will contact you.

***Why We May Transfer Your Personal Data***

In certain circumstances we may be legally obliged to share personal data and other information with respect to your shareholding with the relevant regulatory authorities such as the Cayman Islands Monetary Authority or the Tax Information Authority. They, in turn, may exchange this information with foreign authorities, including tax authorities.

We anticipate disclosing personal data to persons who provide services to us and their respective affiliates (which may include certain entities located outside the US, the Cayman Islands, or the European Economic Area), who will process your personal data on our behalf.

***The Data Protection Measures We Take***

Any transfer of personal data by us or our duly authorized affiliates and/or delegates outside of the Cayman Islands shall be in accordance with the requirements of the DPA.

We and our duly authorized affiliates and/or delegates shall apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of personal data, and against accidental loss or destruction of, or damage to, personal data.

We shall notify you of any personal data breach that is reasonably likely to result in a risk to your interests, fundamental rights or freedoms or those data subjects to whom the relevant personal data relates.

***Contacting the Company***

For further information on the collection, use, disclosure, transfer or processing of your personal data or the exercise of any of the rights listed above, please contact us through our website at https://biokeyinc.com/ or through phone number at (845) 291-1291.

***Transfer Agent and Registrar***

The transfer agent and registrar for our Ordinary Shares will be VStock Transfer, LLC, located at 18 Lafayette Place, Woodmere, NY 11598. The telephone number of VStock Transfer, LLC is 212-828-8436.

**Trading**

We will apply to list our ordinary on the OTC Markets, under the ticker symbol assigned to us in connection with, and upon completion of, the OTC listing process.

**WHERE YOU CAN FIND MORE INFORMATION**

We have filed a Registration Statement on Form 10 with the SEC with respect to our Ordinary Shares that ABVC shareholders will receive in the Share Distribution as contemplated by this information statement. This information statement is a part of, and does not contain all the information set forth in, the Registration Statement and the other exhibits and schedules to the Registration Statement. For further information with respect to us and our Ordinary Shares, please refer to the Registration Statement, including its other exhibits and schedules. Statements we make in this information statement relating to any contract or other document are not necessarily complete, and you should refer to the exhibits attached to the Registration Statement for copies of the actual contract or document. You may review a copy of the Registration Statement, including its exhibits and schedules, at the SEC's public reference room, located at 100 F Street, N.E., Washington, D.C. 20549, as well as on the Internet website maintained by the SEC at www.sec.gov. Please call the SEC at 1-800-SEC-0330 for more information on the public reference room. Information contained on any website we refer to in this information statement does not and will not constitute a part of this information statement or the Registration Statement on Form 10 of which this information statement is a part, and such references are intended to be inactive textual references only.

As a result of the Spin-Off, we will become subject to the information and reporting requirements of the Exchange Act and, in accordance with the Exchange Act, we will file periodic reports, proxy statements, and other information with the SEC.

You may request a copy of any of our filings with the SEC at no cost by emailing info@biokeyinc.com or calling at (845) 291-1291.

We also intend to maintain a website at https://biokeyinc.com/ at which you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Our investor relations website provides notifications of news or announcements regarding our financial performance, including SEC filings, investor events, press and earnings releases, and blogs.

We intend to furnish holders of our Ordinary Shares with annual reports containing financial statements prepared in accordance with U.S. GAAP and audited and reported on by an independent registered public accounting firm.

**INDEX TO** 

**BIOKEY (CAYMAN), INC.**

**CONSOLIDATED FINANCIAL STATEMENTS**

**TABLE OF CONTENTS**

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| PAGE | F-2 | [REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID 2485)](#f_001) |
| PAGE | F-3 | [CONSOLIDATED BALANCE SHEETS AT DECEMBER 31, 2025 AND 2024](#f_002) |
| PAGE | F-4 | [CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024](#f_003) |
| PAGE | F-5 | [CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024](#f_004) |
| PAGE | F-6 | [CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024](#f_005) |
| PAGE | F-7 | [NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS](#f_006) |
| PAGE | F-18 | [UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2026 AND DECEMBER 31, 2025](#f_007) |
| PAGE | F-19 | [UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025](#f_008) |
| PAGE | F-20 | [UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025](#f_009) |
| PAGE | F-21 | [CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025](#f_010) |
| PAGE | F-22 | [NOTES TO CONSOLIDATED FINANCIAL STATEMENTS](#f_011) |

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| ![](ea029154601_ex99-1img3.jpg) | **17506 Colima Road, Ste 101,**<br> **Rowland Heights, CA 91748**<br> **Tel: +1 (626) 581-0818**<br> **Fax: +1 (626) 581-0809**<br>|

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID 2485)**

**Opinion on the Consolidated Financial Statements**

We have audited the accompanying consolidated balance sheets of Biokey (Cayman), Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders' deficit, and cash flows for each of the years then ended, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years then ended**,** in conformity with accounting principles generally accepted in the United States of America.

**Substantial Doubt About the Company's Ability to Continue as a Going Concern**

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 2 to the consolidated financial statements, the Company incurred substantial losses during the year ended December 31, 2025. As of December 31, 2025, the Company had a working capital deficit and net cash outflows from operating activities. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.

**Basis for Opinion**

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/Simon & Edward, LLP

We have served as the Company's auditor since 2024.

PCAOB ID: 2485

Rowland Heights, California

May 27, 2026

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| **ASSETS** |  |  |
| Current Assets |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $2883 | $8145 |
| &nbsp;&nbsp;&nbsp;Due from related parties | 24558 | 12558 |
| &nbsp;&nbsp;&nbsp;Prepaid expense and other current assets | 34381 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Assets | 61822 | 20703 |
| Property and equipment, net | 80519 | 103471 |
| Operating lease right-of-use assets | 1724404 | 394834 |
| Security deposits | 13333 | 10440 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Assets | $1880078 | $529448 |
| **LIABILITIES AND EQUITY** |  |  |
| Current Liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | $329308 | $319310 |
| &nbsp;&nbsp;&nbsp;Contract liabilities | 12600 | 81115 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | 271187 | 337932 |
| &nbsp;&nbsp;&nbsp;Due to related parties | 4298769 | 3613358 |
| &nbsp;&nbsp;&nbsp;Accrued interest payable – related parties | 583847 | 429955 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Liabilities | 5495711 | 4781670 |
| Tenant security deposit |  | 21680 |
| Operating lease liability – non-current | 1458243 | 56902 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Liabilities | 6953954 | 4860252 |
| COMMITMENTS AND CONTINGENCIES |  |  |
| Stockholders' Equity (Deficits) |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value, 500,000,000 shares authorized, 30,000,000 and 30,000,000 shares issued and outstanding as of December 31, 2025 and 2024, respectively\* | 3000 | 3000 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (5076876) | (4333804) |
| Total Stockholders' deficit | (5073876) | (4330804) |
| Total Liabilities and Equity | $1880078 | $529448 |

---

\* The number of shares and amounts are presented on a retrospective basis. See Note 1.

 

*The accompanying notes are an integral part of these consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**YEARS ENDED DECEMBER 31, 2025 AND 2024**

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| **Revenue** | $- | $13589 |
| **Cost of revenue** | - | 763 |
| **Gross profit** | - | 12826 |
| **Operating expenses** |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 712319 | 764854 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 712319 | 764854 |
| **Loss from operations** | (712319) | (752028) |
| **Other income (expense)** |  |  |
| &nbsp;&nbsp;&nbsp;Interest income |  | 2 |
| &nbsp;&nbsp;&nbsp;Interest expense | (153891) | (153489) |
| &nbsp;&nbsp;&nbsp;Operating sublease income | 155796 | 70078 |
| &nbsp;&nbsp;&nbsp;Other income (expense), net | (32658) | 44157 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expenses | (30753) | (39252) |
| **Loss before provision for income tax** | (743072) | (791280) |
| Provision for income tax expense | - | - |
| **Net loss** | $(743072) | $(791280) |
| Net loss per share: |  |  |
| Basic and diluted | $(0.02) | $(0.03) |
| Weighted average number of common shares outstanding: |  |  |
| Basic and diluted | 30000000 | 30000000 |

---

*The accompanying notes are an integral part of these consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**YEARS ENDED DECEMBER 31, 2025 AND 2024**

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(743072) | $(791280) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 22952 | 25229 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for doubtful accounts |  | 11993 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 422825 | 319870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (34381) | 3585 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due from related parties | (12000) | (12558) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | 9998 | 16349 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable – related party | 166177 | 153489 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Security deposits | (2893) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities | (68515) | 1615 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant security deposit | (21680) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (417799) | (319870) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in operating activities** | (678388) | (591578) |
| **Cash flows from investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of equipment | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in investing activities** | - | - |
| **Cash flows from financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Due to related parties | 673126 | 587457 |
| **Net cash provided by financing activities** | 673126 | 587457 |
| **Net decrease in cash and cash equivalents** | (5262) | (4121) |
| **Cash and cash equivalents** |  |  |
| Beginning | 8145 | 12266 |
| Ending | $2883 | $8145 |
| **Supplemental disclosure of cash flows** |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid during the year for: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest paid | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes paid | $- | $- |
| **Non-cash financing and investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment of lease agreement | $1752395 | $- |

---

*The accompanying notes are an integral part of these consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT** 

**YEARS ENDED DECEMBER 31, 2025 AND 2024** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Common Stock\*** | **Common Stock\*** | | |
|  | **Number of shares** | **Amounts** |<br>**Accumulated Deficit** |<br>**Stockholders' Deficit** |
| **Balance at December 31, 2023** | 30000000 | 3000 | (3542524) | (3539524) |
| Net loss for the period | - | - | (791280) | (791280) |
| **Balance at December 31, 2024** | 30000000 | $3000 | $(4333804) | $(4330804) |
| Net loss for the period | - | - | (743072) | (743072) |
| **Balance at December 31, 2025** | 30000000 | $3000 | $(5076876) | $(5073876) |

---

\* The number of shares and amounts are presented on a retrospective basis. See Note 1.

 

*The accompanying notes are an integral part of these consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**1. ORGANIZATION AND DESCRIPTION OF BUSINESS**

BioKey (Cayman), INC. ("BioKey Cayman"), incorporated in the Cayman Islands in June 2023, operates through its California-based entity BioKey, Inc ("BK California"), to develop generic drugs for the growing pharmaceutical industry, and to provide integrated Contract Research Organization ("CRO") and Contract Development and Marketing Organization ("CDMO") platform, offering both research and manufacturing services

<u>Reorganization with BK California</u>

On May 10, 2025, ABVC BioPharma, Inc ("ABVC"), the sole shareholder of the BioKey Cayman and BioKey, which is also known as the common controlling shareholder, entered into a Share Transfer Agreement ("STA") with BK California and BioKey Cayman, to transfer ABVC's 100% ownership in BK California to BioKey Cayman. In accordance with Financial Accounting Standard Board ("FASB") Accounting Standards Codification ("ASC") No. 805-50, the assets and liabilities of BK California were transferred to BioKey Cayman at their historical carrying values, and no goodwill was recognized. The accompanying financial statements have been retrospectively adjusted to include the results of BK California as if the combination had occurred at the beginning of the earliest period presented. This presentation reflects the continuity of ownership and operations and is consistent with the accounting treatment for transactions among entities under common control. The combined entity is hereinafter referred to as the "Company".

**2. LIQUIDITY AND GOING CONCERN**

***Liquidity and Going Concern***

The accompanying financial statements have been prepared in conformity with the generally accepted accounting principles in the United States of America (the "U.S. GAAP") which contemplates continuation of the Company on a going concern basis. The going concern basis assumes that assets are realized, and liabilities are settled in the ordinary course of business at amounts disclosed in the financial statements. The Company's ability to continue as a going concern depends upon its ability to market and sell its products to generate positive operating cash flow. For the year ended December 31, 2025, the Company reported net loss of $743,072. As of December 31, 2025, the Company's working capital deficit was $5,433,889. In addition, the Company had net cash outflows of $678,388 from operating activities for the year ended December 31, 2025. These conditions give rise to substantial doubt as to whether the Company will be able to continue as a going concern.

To sustain its ability to support the Company's operating activities, the Company may have to consider supplementing its available sources of funds through the following sources:

● cash generated from operations;

● other available sources of financing from banks and other financial institutions in the U.S. and in Taiwan; and;

● financial support from the Company's related parties and shareholders.

Management's plan is to continue to improve operations to generate positive cash flows and raise additional capital through private or public offerings, or financial support from related parties or shareholders. If the Company cannot generate positive operating cash flow, and raise additional capital, there is the risk that the Company may not be able to meet its short-term obligations. All these factors raise substantial doubt about the ability of the Company to continue as a going concern. The consolidated financial statements for the years ended December 31, 2025 and 2024 have been prepared on a going concern basis and do not include any adjustments to reflect the possible future effects on the recoverability and classifications of assets or the amounts and classifications of liabilities that may result from the inability of the Company to continue as a going concern.

**3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

<u>Basis of Presentation</u>

The accompanying consolidated financial statements have been prepared in accordance with the U.S. GAAP and pursuant to the regulations of the Securities and Exchange Commission (the "SEC"). All significant intercompany transactions and account balances have been eliminated. The Company's fiscal year is the calendar year.

<u>Use of Estimates</u>

The preparation of financial statements in conformity with the U.S. GAAP that requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the amount of revenues and expenses during the reporting periods. Actual results could differ materially from those results.

<u>Fair Value Measurements</u>

ASC 820 "Fair Value Measurements" defines fair value for certain financial and nonfinancial assets and liabilities that are recorded at fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. It requires that an entity measures its financial instruments to base fair value on exit price, maximize the use of observable units and minimize the use of unobservable inputs to determine the exit price. It establishes a hierarchy which prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy increases the consistency and comparability of fair value measurements and related disclosures by maximizing the use of observable inputs and minimizing the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the assets or liabilities based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in circumstances. The hierarchy prioritizes the inputs into three broad levels based on the reliability of the inputs as follows:

● Level 1– Inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date. Valuation of these instruments does not require a high degree of judgment as the valuations are based on quoted prices in active markets that are readily and regularly available.

● Level 2– Inputs other than quoted prices in active markets that are either directly or indirectly observable as of the measurement date, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

● Level 3– Valuations based on inputs that are unobservable and not corroborated by market data. The fair value for such assets and liabilities is generally determined using pricing models, discounted cash flow methodologies, or similar techniques that incorporate the assumptions a market participant would use in pricing the asset or liability.

The carrying values of certain assets and liabilities of the Company, such as cash and cash equivalents, due from related parties, prepaid expenses and other current assets, accrued expenses and other current liabilities, and due to related parties, approximate fair value due to their relatively short maturities. The carrying value of the Company's accrued interest approximates their fair value as the terms of the borrowing are consistent with current market rates and the duration to maturity is short.

<u>Concentration of Credit Risk</u>

The Company's financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. The Company deposits cash in reputable financial institutions covered by FDIC's $250,000 insurance. However, the Company does not anticipate any losses on excess deposits. The Company does not enter financial instruments for hedging, trading or speculative purposes.

The Company performs ongoing credit evaluation of its customers and requires no collateral. Credit losses and allowance for unbilled receivables are provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining its historical collection experience, current economic conditions, reasonable and supportable forecasts of future economic conditions, as well as its internal credit policies. Actual credit losses may differ from our estimates.

<u>Concentration of Clients</u>

For the year ended December 31, 2024, one customer accounted for 65.8% of the Company's total revenue.

<u>Cash and Cash Equivalents</u>

The Company considers highly liquid investments with maturities of three months or less to be cash equivalents when purchased. As of December 31, 2025 and 2024, the Company's cash and cash equivalents amounted to $2,883 and $8,145, respectively. The Company's cash and cash equivalents are deposited with the financial institutions located in the U.S.

<u>Accounts receivable and allowance for expected credit losses accounts</u>

Accounts receivables are recorded and carried at the original invoiced amount less an allowance for any potential uncollectible amounts.

The Company make estimates of expected credit and collectability trends for the allowance for credit losses and allowance for unbilled receivables based upon our assessment of various factors, including historical experience, the age of the accounts receivable balances, credit quality of customers, current economic conditions reasonable and supportable forecasts of future economic conditions, and other factors that may affect our ability to collect from customers. The provision is recorded against accounts receivable balances, with a corresponding charge recorded in the consolidated statements of income. Actual amounts received may differ from management's estimate of credit worthiness and the economic environment. Delinquent account balances are written off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable.

Allowance for expected credit losses accounts were $0 and $11,993 as of December 31, 2025 and 2024, respectively.

<u>Revenue Recognition</u>

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Pursuant to ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines is within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration the Company is entitled to in exchange for the goods or services the Company transfers to the customers. At inception of the contract, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

<u>CDMO Service Revenue</u>

The Company's revenues are mainly derived from Research and Development Activities Services (also known as the Contract Development & Manufacturing Organization Services ("CDMO"). Revenues related to research and development and regulatory activities are recognized when the related services or activities are performed, in accordance with the contract terms. The Company typically has only one performance obligation at the beginning of a contract, which is to perform research and development services. The Company may also provide its customers with an option to request that the Company provides additional goods or services in the future, such as active pharmaceutical ingredients, API, or IND/NDA/ANDA/510K submissions. The Company evaluates whether these options are material rights at the inception of the contract. If the Company determines an option is a material right, the Company will consider the option a separate performance obligation.

If the Company is entitled to reimbursement from its customers for specified research and development expenses, the Company accounts for the related services that it provides as separate performance obligations if it determines that these services represent a material right. The Company also determines whether the reimbursement of research and development expenses should be accounted for as revenues or an offset to research and development expenses in accordance with provisions of gross or net revenue presentation. The Company recognizes the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance obligations.

The Company then determines the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts, including any variable consideration. Under the outstanding contracts, consideration typically includes fixed consideration and variable consideration in the form of potential milestone payments. At the start of an agreement, the Company's transaction price usually consists of the payments made to or by the Company based on the number of full-time equivalent researchers assigned to the project and the related research and development expenses incurred. The Company does not typically include any payments that the Company may receive in the future in its initial transaction price because the payments are not probable. The Company would reassess the total transaction price at each reporting period to determine if the Company should include additional payments in the transaction price.

The Company receives payments from its customers based on billing schedules established in each contract. Upfront payments and fees may be recorded as advances from customers upon receipt or when due, and may require deferral of revenue recognition for a future period until the Company performs its obligations under these arrangements. Amounts are recorded as accounts receivable when the right of the Company to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customers and the transfer of the promised goods or services to the customers will be one year or less.

<u>Property and Equipment, net</u>

 ****

Property and equipment, net is carried at cost net of accumulated depreciation. Repairs and maintenance are expensed as incurred. Expenditures that improve the functionality of the related asset or extend the useful life are capitalized. When property and equipment are retired or otherwise disposed of, the related gain or loss is included in operating income. Leasehold improvements are depreciated on the straight-line method over the shorter of the remaining lease term or estimated useful life of the asset. Depreciation is calculated on the straight-line method generally based on the following useful lives:

---

| | |
|:---|:---|
|  | **Estimated <br> Life<br> in Years** |
| Leasehold improvements | 3 ~ 15 |
| Machinery and equipment | 3 ~ 8 |
| Office equipment | 3 |

---

<u>Impairment of Long-Lived Assets</u>

The Company has followed the guidance of ASC subtopic 360-10, Property, Plant and Equipment. ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates its long-lived assets for impairment annually or more often if events and circumstances warrant. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. ASC 360-10 also requires assets to be disposed of to be reported at the lower of the carrying amount or the fair value less costs to sell.

<u>Research and Development Expenses</u>

The Company accounts for the cost of using licensing rights in research and development costs according to ASC 730-10-25-1. This guidance provides that absent alternative future uses the acquisition of product rights to be used in research and development activities must be charged to research and development expenses when incurred.

The Company accounts for R&D costs in accordance with ASC 730 "Research and Development". Research and development expenses are charged to expense as incurred unless there is an alternative future use in other research and development projects or otherwise. Research and development expenses are comprised of costs incurred in performing research and development activities, including personnel-related costs, facilities-related overhead, and outside contracted services including clinical trial costs, manufacturing and process development costs for both clinical and preclinical materials, research costs, and other consulting services. Non-refundable advance payment for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made. In instances where the Company enters into agreements with third parties to provide research and development services, costs are expensed as services are performed.

<u>Income Taxes</u>

The Company accounts for income taxes using the asset and liability approach which allows the recognition and measurement of deferred tax assets to be based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will expire before the Company is able to realize their benefits, or future deductibility is uncertain.

Under ASC 740, a tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefits recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer satisfied. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalty or interest relating to income taxes has been incurred for the years ended December 31, 2025 and 2024. GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition.

<u>Valuation of Deferred Tax Assets</u>

A valuation allowance is recorded to reduce the Company's deferred tax assets to the amount that is more likely than not to be realized. In assessing the need for the valuation allowance, management considers, among other things, projections of future taxable income and ongoing prudent and feasible tax planning strategies. If the Company determines that sufficient negative evidence exists, then it will consider recording a valuation allowance against a portion or all of the deferred tax assets in that jurisdiction. If, after recording a valuation allowance, the Company's projections of future taxable income and other positive evidence considered in evaluating the need for a valuation allowance prove, with the benefit of hindsight, to be inaccurate, it could prove to be more difficult to support the realization of its deferred tax assets. As a result, an additional valuation allowance could be required, which would have an adverse impact on its effective income tax rate and results. Conversely, if, after recording a valuation allowance, the Company determines that sufficient positive evidence exists in the jurisdiction in which the valuation allowance was recorded, it may reverse a portion or all of the valuation allowance in that jurisdiction. In such situations, the adjustment made to the deferred tax asset would have a favorable impact on its effective income tax rate and results in the period such determination was made.

<u>Loss Per Share of Common Stock</u>

The Company calculates net loss per share in accordance with ASC 260, "Earnings per Share". Basic loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive. Diluted earnings per share excludes all dilutive potential shares if their effect is anti-dilutive.

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| Numerator: Net loss | $(743072) | $(791280) |
| Denominator: Weighted-average shares outstanding – Basic & Diluted | 30000000 | 30000000 |
| Loss per share: Basic & Diluted | $(0.02) | $(0.03) |

---

<u>Commitments and Contingencies</u>

The Company has adopted ASC 450 "Contingencies" subtopic 20, in determining its accruals and disclosures with respect to loss contingencies. Accordingly, estimated losses from loss contingencies are accrued by a charge to income when information available before financial statements are issued or are available to be issued indicates that it is probable that an asset had been impaired or a liability had been incurred on the date of the financial statements, and the amount of the loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. If a loss contingency is not probable or reasonably estimable, disclosure of the loss contingency is made in financial statements when it is at least reasonably possible that a material loss could be incurred.

<u>Segment Reporting</u>

ASC 280 "Segment Reporting" requires public companies to report financial and descriptive information about their reportable operating segments. The Company identifies the operating segments based on how the chief operating decision maker internally evaluates separate financial information, business activities and management responsibility.

The Company currently has one reportable segment, and assets are reviewed on a consolidated basis. As such, segmental data is not provided.

The following tables present revenue and gross profit information for each of our only reportable segment:

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| Revenue | $- | $13589 |
| Cost of revenue | - | 763 |
| Segment gross profit | $- | $12826 |
| Depreciation expense | $22952 | $25229 |

---

The following table provides a reconciliation of total segment gross profit to the Company's loss before provision for income tax:

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| Segment gross profit | $- | $12826 |
| Less: |  |  |
| Selling, general and administrative expenses | 712319 | 764854 |
| Research and development expenses |  |  |
| Add (less): |  |  |
| Interest income |  | 2 |
| Interest expense | (153891) | (153489) |
| Operating sublease income | 155796 | 70078 |
| Other income (expenses), net | (32658) | 44157 |
| Loss before provision for income tax | $(743072) | $(791280) |

---

<u>Recent Accounting Pronouncements</u>

In November 2024, the FASB issued ASU No. 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disclosure of specified information about certain costs and expenses. This includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The ASU is effective on a prospective or retrospective basis for annual reporting period beginning after December 15, 2026, and interim reporting period beginning after December 15, 2027. Early adoption is permitted. This ASU will likely result in the required additional disclosures being included in our consolidated financial statements once adopted.

**4. PROPERTY AND EQUIPMENT**

The Company leases a GMP manufacturing facility in Fremont, CA. Property and equipment as of December 31, 2025 and 2024 are summarized as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| Leasehold improvements | $2105745 | $2105745 |
| Machinery and equipment | 1027131 | 1027131 |
| Office equipment | 6081 | 6081 |
|  | 3138957 | 3138957 |
| Less: accumulated depreciation | (3058438) | (3035486) |
| Property and equipment, net | $80519 | $103471 |

---

Depreciation expenses were $22,952 and $25,229 for the years ended December 31, 2025 and 2024, respectively.

**5. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES**

Accrued expenses and other current liabilities consisted of the following as of the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| Accrued directors and officers (owners) compensation | $235625 | $235625 |
| Accrued rent payables | 30665 | 46702 |
| Accrued compensation and employee benefits | 3850 | 3850 |
| Others | 59168 | 33133 |
| Total | $**329308** | $**319310** |

---

**6. RELATED PARTIES TRANSACTIONS**

The related parties of the company with whom transactions are reported in these financial statements are as follows:

---

| | |
|:---|:---|
| **Name of entity or Individual** | **Relationship with the Company and its SUBSIDIARY** |
| ABVC BioPharma, Inc. ("ABVC") | Sole shareholder of BioKey Cayman |
| BioLite Inc. ("BioLite") | A majorly owned subsidiary of ABVC |
| AiBtl BioPharma Inc. ("AiBtl") | A majorly owned subsidiary of ABVC |
| Rgene Corporation (the "Rgene") | The Chairman of Rgene is Mr. Tsung-Shann Jiang |
| The Jiangs | Mr. Tsung-Shann Jiang, the controlling beneficiary shareholder of Rgene, the Chief Scientific Officer (CSO) of ABVC, the Chairman and CEO of BioLite Holding Inc. and BioLite Inc. and the President and a member of board of directors of BioFirst<br>Ms. Shu-Ling Jiang, a member of board of directors of ABVC and BioLite Inc. |

---

<u>Other operating expense – related parties</u>

On June 10, 2022, BK California entered a clinical development service agreement with BioLite for $20,000 per month, to use BK California's experience and capabilities to provide clinical development service of certain products to Rgene. During the years ended December 31, 2025 and 2024, the contract expenses charged by BioLite were $0 and $100,000, respectively. As of December 31, 2025 and 2024, $200,000 and $200,000 was payable to BioLite, respectively.

<u>Operating sublease income – related parties</u>

During the years ended December 31, 2025 and 2024, the Company sublease certain facility and office spaces to ABVC and AiBtl. The sublease income recognized is as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| ABVC | $9600 | $9600 |
| AiBtl | 12000 | 12000 |
| Total | $**21600** | $**21600** |

---

<u>Interest expenses – related parties</u>

The Company relied on related parties to fund its operations and has a recurring loan from ABVC. During the years ended December 31, 2025 and 2024, the accrued interest expenses were $153,892 and $153,489, respectively. The loan is due on demand, but ABVC is not intended to demand the loan in the near future.

<u>Due from related parties</u>

Amount due from related parties consisted of the following as of the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| AiBtl | $24558 | $12558 |

---

Amount due from AiBtl includes sublease rent receivables and certain operating expenses paid on behalf of AiBtl.

<u>Due to related parties</u>

Amount due to related parties consisted of the following as of the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| ABVC (1) | $4673818 | $3385867 |
| BioLite (2) | 208798 | 197491 |
| Jiangs (3) | - | 30000 |
| Total | $**4882616** | $**3613358** |

---

(1) Since 2020, the Company has been relying on ABVC's recurring loans to support the Company's operation. These loans bore an interest rate of 1.5% to 6.5% per annum. As of December 31, 2025 and 2024, the loan principal balances are amounted to $2,629,911 and $2,438,711, respectively. The remaining balances are accrued interests and certain operating expenses paid by ABVC on behalf of the Company. ABVC is not intended to demand the loan in the near future.

(2) Mainly payables to clinical development services, offsetting by certain payments made by the Company on behalf of BioLite. Such advances bear no interest.

(3) Since 2019, the Jiangs advanced funds to the Company for working capital purposes. As of December 31, 2025 and 2024, the outstanding balance due to the Jiangs amounted to $0 and $30,000, respectively. These loans bear no interest and are due on demand.

**7. INCOME TAXES**

Since the Company has not generated operating profits during the reporting periods, there is no income tax expenses or benefits recognized for the years ended December 31, 2025 and 2024.

Deferred tax assets (liability) as of December 31, 2025 and 2024 consist approximately of:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| Net operating loss carryforwards | $1503866 | $1293207 |
| Operating lease liabilities | 363180 | 82915 |
| Operating lease assets | (326125) | (82915) |
| Deferred tax assets, Gross | 1504921 | 1293207 |
| Valuation allowance | (1504921) | (1293207) |
| Deferred tax assets, net | $**-** | $**-** |

---

**8. EQUITY**

The Company has Common stock, $0.0001 par value, 500,000,000 shares authorized, 30,000,000 and 30,000,000 shares issued and outstanding as of December 31, 2025 and 2024, respectively.

**9. LEASE**

The Company adopted ASC 842 on January 1, 2019 using the modified retrospective approach and elected the transition practical expedient not to restate comparative periods. In applying the standard, the Company elected several practical expedients, including not reassessing whether existing or expired contracts contained leases, not reassessing prior lease classifications or initial direct costs, using hindsight when evaluating lease terms and potential impairments, and not reevaluating pre-existing land easements accounted for under ASC 840. The Company also elected the short-term lease exemption and generally accounts for lease and non-lease components separately.

Under ASC 842, the Company recognizes right-of-use ("ROU") assets and corresponding lease liabilities on the consolidated balance sheets. ROU assets represent the right to use the underlying leased assets over the lease term, and lease liabilities represent the present value of future minimum lease payments. Because most leases do not provide an implicit rate, the Company uses its incremental borrowing rate at lease commencement to measure lease liabilities. Future minimum lease payments primarily include fixed base rent obligations.

The Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months. The ROU assets were adjusted per ASC 842 transition guidance for existing lease-related balances of accrued and prepaid rent, unamortized lease incentives provided by lessors, and restructuring liabilities. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in Selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

The Company has no finance leases. The Company's leases primarily include various office and laboratory spaces, and vehicles under various operating lease arrangements. The Company's operating leases have remaining lease terms of up to approximately five years.

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| **ASSETS** |  |  |
| Operating lease right-of-use assets | $1724404 | $394834 |
| **LIABILITIES** |  |  |
| Operating lease liabilities (current) | 271187 | 337932 |
| Operating lease liabilities (non-current) | 1458243 | 56902 |

---

***Supplemental Information***

The following provides details of the Company's lease expenses:

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| Operating lease expenses | $415446 | $421894 |
| Short-term lease expenses | 11574 | - |
| Total lease expenses | $427020 | $421894 |

---

Other information related to leases is presented below:

---

| | | |
|:---|:---|:---|
|  | **Year Ended <br> December 31,** | **Year Ended <br> December 31,** |
|  | **2025** | **2024** |
| Cash paid for amounts included in the measurement of operating lease liabilities | $38878 | $135867 |
| Rent paid with ABVC's common stock included in the measurement of operating lease liabilities | $388142 | $255788 |

---

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2025** | **2024** |
| Weighted Average Remaining Lease Term: |  |  |
| Operating leases | 5.13 years | 1.16 years |
| Weighted Average Discount Rate: |  |  |
| Operating leases | 7.61% | 0.35% |

---

The minimum future annual payments under non-cancellable leases during the next five years and thereafter, at rates now in force, are as follows:

---

| | |
|:---|:---|
|  | **Operating <br> leases** |
| 2026 | $390390 |
| 2027 | 393554 |
| 2028 | 398550 |
| 2029 | 410506 |
| 2030 | 422821 |
| Thereafter | 70814 |
| Total future minimum lease payments, undiscounted | 2086635 |
| Less: Imputed interest | (357205) |
| Present value of future minimum lease payments | $1729430 |

---

**10. COMMITMENTS AND CONTINGENCIES**

In the ordinary course of business, the Company may be subject to legal proceedings regarding contractual and employment relationships and a variety of other matters. The Company records contingent liabilities resulting from such claims, when a loss is assessed to be probable, and the amount of the loss is reasonably estimable. In the opinion of management, there were no pending or threatened claims and litigation as of December 31, 2025 and up through the date of the consolidated financial statements was available to the issued.

**11. SUBSEQUENT EVENTS**

The Company has assessed all events from December 31, 2025, up through the date that these consolidated financial statements are available to be issued, and concluded that no subsequent events have occurred that would require recognition or disclosure in the Company's consolidated financial statements.

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **March 31,**<br>**2026** | **December 31**<br>**2025** |
| **ASSETS** |  |  |
| Current Assets |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $1614 | $2883 |
| &nbsp;&nbsp;&nbsp;Due from related parties | 12558 | 24558 |
| &nbsp;&nbsp;&nbsp;Prepaid expense and other current assets | 41987 | 34381 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Assets | 56159 | 61822 |
| Property and equipment, net | 75224 | 80519 |
| Operating lease right-of-use assets | 1653263 | 1724404 |
| Security deposits | 13333 | 13333 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Assets | $1797979 | $1880078 |
| **LIABILITIES AND EQUITY** |  |  |
| Current Liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | $327030 | $329308 |
| &nbsp;&nbsp;&nbsp;Contract liabilities | 12600 | 12600 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | 287601 | 271187 |
| &nbsp;&nbsp;&nbsp;Due to related parties | 4445056 | 4298769 |
| &nbsp;&nbsp;&nbsp;Accrued interest payable - related parties | 625342 | 583847 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Current Liabilities | 5697629 | 5495711 |
| Operating lease liability – non-current | 1381952 | 1458243 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Liabilities | 7079581 | 6953954 |
| COMMITMENTS AND CONTINGENCIES |  |  |
| Stockholders' Equity (Deficits) |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value, 50,000,000 shares authorized, 30,000,000 and 30,000,000 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively\* | 3000 | 3000 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (5284602) | (5076876) |
| Total Stockholders' equity (deficit) | (5281602) | (5073876) |
| &nbsp;&nbsp;&nbsp;Total Liabilities and Equity | $1797979 | $1880078 |

---

\* The number of shares and amounts are presented on a retrospective basis. See Note 1.

*The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31,** | **Three Months Ended <br> March 31,** |
|  | **2026** | **2025** |
| **Revenue** | $- | $- |
| **Cost of revenue** | - | - |
| **Gross profit** | - | - |
| **Operating expenses** |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 184230 | 129576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 184230 | 129576 |
| **Loss from operations** | (184230) | (129576) |
| **Other income (expense)** |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense | (41496) | (41128) |
| &nbsp;&nbsp;&nbsp;Operating sublease income | 18000 | 17400 |
| &nbsp;&nbsp;&nbsp;Other income (expense), net | - | 318 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expenses | (23496) | (23410) |
| **Loss before provision for income tax** | (207726) | (152986) |
| Provision for income tax expense | - | - |
| **Net loss** | $(207726) | (152986) |
| Net loss per share: |  |  |
| Basic and diluted | $(0.01) | $(0.01) |
| Weighted average number of common shares outstanding: |  |  |
| Basic and diluted | 30000000 | 30000000 |

---

 

*The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31,** | **Three Months Ended <br> March 31,** |
|  | **2026** | **2025** |
| **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(207726) | (152986) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 5295 | 6309 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 71141 | 82259 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories |  | (11460) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (7606) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due from related parties | 12000 | (6000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | (2278) | 29364 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interests – related parties | 41495 | 41128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to related parties | 106287 | 91888 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (59877) | (82259) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in operating activities** | (41269) | (1757) |
| **Cash flows from investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in investing activities** | - | - |
| **Cash flows from financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Due to related parties | 40000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by financing activities** | 40000 | - |
| **Net change in cash and cash equivalents and restricted cash** | (1269) | (1757) |
| **Cash and cash equivalents** |  |  |
| Beginning | 2883 | 8145 |
| Ending | $1614 | 6388 |
| **Supplemental disclosure of cash flows** |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid during the year for: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense paid | $- |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes paid | $- |  |

---

*The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Common Stock\*** | **Common Stock\*** | | |
|  | **Number of<br> shares** | **Amounts** |<br>**Accumulated <br> Deficit** |<br>**Stockholders'<br> Deficit** |
| **Balance at December 31, 2024** | 30000000 | $3000 | $(4333804) | (4330804) |
| Net loss for the period | - | - | (152986) | (152986) |
| **Balance at March 31, 2025** | 30000000 | $3000 | $(4486790) | (4483790) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br> shares** | **Amounts** | **Accumulated<br> Deficit** | **Stockholders'<br> Deficit** |
| **Balance at December 31, 2025** | 30000000 | $3000 | $(5076876) | $(5073876) |
| Net loss for the period | - | - | (207726) | (207726) |
| **Balance at March 31, 2026** | 30000000 | $3000 | $(5284602) | $(5281602) |

---

\* The number of shares and amounts are presented on a retrospective basis. See Note 1.

*The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.*

**BIOKEY (CAYMAN), INC. AND SUBSIDIARY**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**1. ORGANIZATION AND DESCRIPTION OF BUSINESS**

BioKey (Cayman), INC. ("BioKey Cayman"), incorporated in the Cayman Islands in June 2023, operates through its California-based entity BioKey, Inc ("BK California"), to develop generic drugs for the growing pharmaceutical industry, and to provide integrated Contract Research Organization ("CRO") and Contract Development and Marketing Organization ("CDMO") platform, offering both research and manufacturing services.

<u>Reorganization with BK California</u>

On May 10, 2025, ABVC BioPharma, Inc ("ABVC"), the sole shareholder of the BioKey Cayman and BioKey, which is also known as the common controlling shareholder, entered into a Share Transfer Agreement ("STA") with BK California and BioKey Cayman, to transfer ABVC's 100% ownership in BK California to BioKey Cayman. In accordance with Financial Accounting Standard Board ("FASB") Accounting Standards Codification ("ASC") No. 805-50, the assets and liabilities of BK California were transferred to BioKey Cayman at their historical carrying values, and no goodwill was recognized. The accompanying financial statements have been retrospectively adjusted to include the results of BK California as if the combination had occurred at the beginning of the earliest period presented. This presentation reflects the continuity of ownership and operations and is consistent with the accounting treatment for transactions among entities under common control. The combined entity is hereinafter referred to as the "Company".

**2. LIQUIDITY AND GOING CONCERN**

The accompanying interim condensed consolidated financial statements have been prepared in conformity with the generally accepted accounting principles in the United States of America (the "U.S. GAAP") which contemplates continuation of the Company on a going concern basis. The going concern basis assumes that assets are realized, and liabilities are settled in the ordinary course of business at amounts disclosed in the financial statements. The Company's ability to continue as a going concern depends upon its ability to market and sell its products to generate positive operating cash flow. For the three months ended March 31, 2026, the Company reported net loss of $207,726. As of March 31, 2026, the Company's working capital deficit was $5,641,470. In addition, the Company had net cash outflows of $41,269 from operating activities for the three months ended March 31, 2026. These conditions give rise to substantial doubt as to whether the Company will be able to continue as a going concern.

To sustain its ability to support the Company's operating activities, the Company may have to consider supplementing its available sources of funds through the following sources:

● cash generated from operations;

● other available sources of financing from banks and other financial institutions in the U.S., and in Taiwan;

● financial support from the Company's related parties and shareholders.

Management's plan is to continue to improve operations to generate positive cash flows and raise additional capital through private or public offerings, or financial support from related parties or shareholders. If the Company cannot generate positive operating cash flow, and raise additional capital, there is the risk that the Company may not be able to meet its short-term obligations. All these factors raise substantial doubt about the ability of the Company to continue as a going concern. The interim condensed consolidated financial statements for the periods ended March 31, 2026 and 2025 have been prepared on a going concern basis and do not include any adjustments to reflect the possible future effects on the recoverability and classifications of assets or the amounts and classifications of liabilities that may result from the inability of the Company to continue as a going concern.

**3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

<u>Basis of Presentation</u>

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with the generally accepted accounting principles in the United States of America (the "U.S. GAAP"). All significant intercompany transactions and account balances have been eliminated. These financial statements do not include all the information and footnotes required by the U.S. GAAP for complete financial statements. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with the U.S. GAAP have been condensed or omitted consistent with Article 8 of Regulation S-X. In the opinion of the Company's management, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, in a normal recurring nature, as necessary for the fair statement of the Company's financial position as of March 31, 2026, and results of operations and cash flows for the three months ended March 31, 2026 and 2025. The unaudited interim condensed consolidated balance sheet as of March 31, 2026 has been derived from the audited financial statements at December 31, 2025, and interim results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. These financial statements should be read in conjunction with the audited consolidated financial statements as of and for the years ended December 31, 2025 and 2024, and related notes included in this registration statement.

This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The Company's unaudited financial statements are expressed in U.S. dollars.

<u>Use of Estimates</u>

The preparation of financial statements in conformity with the U.S. GAAP that requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements and the amount of revenues and expenses during the reporting periods. Actual results could differ materially from those results.

<u>Fair Value Measurements</u>

ASC 820 "Fair Value Measurements" defines fair value for certain financial and nonfinancial assets and liabilities that are recorded at fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. It requires that an entity measures its financial instruments to base fair value on exit price, maximize the use of observable units and minimize the use of unobservable inputs to determine the exit price. It establishes a hierarchy which prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy increases the consistency and comparability of fair value measurements and related disclosures by maximizing the use of observable inputs and minimizing the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the assets or liabilities based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in circumstances. The hierarchy prioritizes the inputs into three broad levels based on the reliability of the inputs as follows:

● Level 1 – Inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date. Valuation of these instruments does not require a high degree of judgment as the valuations are based on quoted prices in active markets that are readily and regularly available.

● Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable as of the measurement date, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

● Level 3 – Valuations based on inputs that are unobservable and not corroborated by market data. The fair value for such assets and liabilities is generally determined using pricing models, discounted cash flow methodologies, or similar techniques that incorporate the assumptions a market participant would use in pricing the asset or liability.

The carrying values of certain assets and liabilities of the Company, such as cash and cash equivalents, accounts receivable, due from related parties, prepaid expenses and other current assets, accrued expenses and other current liabilities, and due to related parties, approximate fair value due to their relatively short maturities. The carrying value of the Company's accrued interest approximates their fair value as the terms of the borrowing are consistent with current market rates and the duration to maturity is short.

<u>Concentration of Credit Risk</u>

The Company's financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. The Company deposits cash in reputable financial institutions covered by FDIC's $250,000 insurance. However, the Company does not anticipate any losses on excess deposits. The Company does not enter financial instruments for hedging, trading or speculative purposes.

The Company performs ongoing credit evaluation of its customers and requires no collateral. Credit losses and allowance for unbilled receivables are provided based on a review of the collectability of accounts receivable. The Company determines the amount of allowance for doubtful accounts by examining its historical collection experience, current economic conditions, reasonable and supportable forecasts of future economic conditions, as well as its internal credit policies. Actual credit losses may differ from our estimates.

<u>Concentration of Clients</u>

No revenue was generated in the three months ended March 31, 2026 and 2025, respectively.

<u>Revenue Recognition</u>

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Pursuant to ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines is within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration the Company is entitled to in exchange for the goods or services the Company transfers to the customers. At inception of the contract, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

*<u>CDMO Service Revenue</u>*

The Company's revenues are mainly derived from Research and Development Activities Services (also known as the Contract Development & Manufacturing Organization Services ("CDMO"). Revenues related to research and development and regulatory activities are recognized when the related services or activities are performed, in accordance with the contract terms. The Company typically has only one performance obligation at the beginning of a contract, which is to perform research and development services. The Company may also provide its customers with an option to request that the Company provides additional goods or services in the future, such as active pharmaceutical ingredients, API, or IND/NDA/ANDA/510K submissions. The Company evaluates whether these options are material rights at the inception of the contract. If the Company determines an option is a material right, the Company will consider the option a separate performance obligation.

If the Company is entitled to reimbursement from its customers for specified research and development expenses, the Company accounts for the related services that it provides as separate performance obligations if it determines that these services represent a material right. The Company also determines whether the reimbursement of research and development expenses should be accounted for as revenues or an offset to research and development expenses in accordance with provisions of gross or net revenue presentation. The Company recognizes the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance obligations.

The Company then determines the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts, including any variable consideration. Under the outstanding contracts, consideration typically includes fixed consideration and variable consideration in the form of potential milestone payments. At the start of an agreement, the Company's transaction price usually consists of the payments made to or by the Company based on the number of full-time equivalent researchers assigned to the project and the related research and development expenses incurred. The Company does not typically include any payments that the Company may receive in the future in its initial transaction price because the payments are not probable. The Company would reassess the total transaction price at each reporting period to determine if the Company should include additional payments in the transaction price.

The Company receives payments from its customers based on billing schedules established in each contract. Upfront payments and fees may be recorded as advances from customers upon receipt or when due, and may require deferral of revenue recognition for a future period until the Company performs its obligations under these arrangements. Amounts are recorded as accounts receivable when the right of the Company to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customers and the transfer of the promised goods or services to the customers will be one year or less.

<u>Loss Per Share of Common Stock</u>

The Company calculates net loss per share in accordance with ASC 260, "Earnings per Share". Basic loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive. Diluted earnings per share excludes all dilutive potential shares if their effect is anti-dilutive.

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31,<br> (Unaudited)** | **Three Months Ended <br> March 31,<br> (Unaudited)** |
|  | **2026** | **2025** |
| Numerator: |  |  |
| Net loss | $(207726) | $(152986) |
| Denominator: |  |  |
| Weighted-average shares outstanding – Basic & Diluted | 30000000 | 30000000 |
| Loss per share |  |  |
| -Basic & Diluted | $(0.01) | $(0.01) |

---

<u>Commitments and Contingencies</u>

The Company has adopted ASC 450 "Contingencies" subtopic 20, in determining its accruals and disclosures with respect to loss contingencies. Accordingly, estimated losses from loss contingencies are accrued by a charge to income when information available before financial statements are issued or are available to be issued indicates that it is probable that an asset has been impaired or a liability has been incurred on the date of the financial statements and the amount of the loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. If a loss contingency is not probable or reasonably estimable, disclosure of the loss contingency is made in financial statements when it is at least reasonably possible that a material loss could be incurred.

<u>Segment Reporting</u>

ASC 280 "Segment Reporting" requires public companies to report financial and descriptive information about their reportable operating segments.

The Company uses the management approach to determine operating segments. The management approach considers the internal organization and reporting used by the Group's chief operating decision maker ("CODM") for making decisions, allocating resources and assessing performance. The Group's CODM was identified as the Chief Executive Officer and Chairman of the Board, who reviews consolidated results at a consolidated level when making decisions about allocating resources and assessing performance of the Group. The Group believes it has only one operating segment and reportable segment, which is biotechnology to fulfill unmet medical needs and focuses on the development of new drugs and medical devices derived from plants.

The Company does not distinguish revenues, costs or expenses between markets in its internal reporting, and reports costs and expenses by nature as a whole. Hence, the Company has only one reportable segment. The following table shows revenues and long-lived assets by geographic areas.

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended**<br> **March 31,**<br> **(Unaudited)** | **Three Months Ended**<br> **March 31,**<br> **(Unaudited)** |
|  | **2026** | **2025** |
| Revenue | $- | $- |
| Revenue from entities in the U.S. |  |  |
| Total | $- | $- |

---

---

| | | |
|:---|:---|:---|
| Property and equipment, net located in | **March 31,<br> 2026** | **December 31,<br> 2025** |
| In USA | $75224 | $80519 |
| Total | $75224 | $80519 |

---

The following table provides a reconciliation of total segment gross profit to the Company's loss before provision for income tax:

---

| | | |
|:---|:---|:---|
|  | **Three Months ended <br> March 31, <br> (Unaudited)** | **Three Months ended <br> March 31, <br> (Unaudited)** |
|  | **2026** | **2025** |
| Segment gross profit | $- | $- |
| Less: |  |  |
| Selling, general and administrative expenses | 184230 | 129576 |
| Add (less): |  |  |
| Interest expense | (41496) | (41128) |
| Operating sublease income | 18000 | 17400 |
| Other income (expenses), net | - | 318 |
| Loss before provision for income tax | $(207726) | $(152986) |

---

<u>Recent Accounting Pronouncements</u>

In accordance with Staff Accounting Bulletin No. 74 (SAB 74), the Company evaluates the impact of newly issued accounting standards on its financial statements. The following standards have been issued but are not yet effective:

In November 2024, the FASB issued ASU No. 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disclosure of specified information about certain costs and expenses. This includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The ASU is effective on a prospective or retrospective basis for annual reporting period beginning after December 15, 2026, and interim reporting period beginning after December 15, 2027. Early adoption is permitted. This ASU will likely result in the required additional disclosures and the Company expects no material impact on consolidated financial statements of adopting.

The Company will continue to monitor other issued but not yet effective standards and will update its disclosures as more information becomes available.

**4. PROPERTY AND EQUIPMENT, AND PREPAMENT FOR ASSET ACQUISITION**

<u>Property and Equipment</u>

The Company leases a GMP manufacturing facility in Fremont, CA. Property and equipment as of March 31, 2026 and December 31, 2025 are summarized as follows:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026<br> (Unaudited)** | **December 31,<br> 2025** |
| Leasehold improvements | $2105745 | $2105745 |
| Machinery and equipment | 1027131 | 1027131 |
| Office equipment | 6081 | 6081 |
|  | 3138957 | 3138957 |
| Less: accumulated depreciation | (3063733) | (3058438) |
| Property and equipment, net | $75224 | $80519 |

---

Depreciation expenses were $5,295 and $6,309 for the three months ended March 31, 2026 and 2025, respectively.

**5. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES**

Accrued expenses and other current liabilities consisted of the following as of the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026<br> (Unaudited)** | **December 31,<br> 2025** |
| Accrued directors and officers (owners) compensation | $235625 | $235625 |
| Accrued rent payables | 30665 | 30665 |
| Accrued compensation and employee benefits | 3850 | 3850 |
| Others | 56890 | 59168 |
| Total | $**327030** | $**329308** |

---

**6. RELATED PARTIES TRANSACTIONS**

The related parties of the company with whom transactions are reported in these financial statements are as follows:

---

| | |
|:---|:---|
| **Name of entity or Individual** | **Relationship with the Company and its subsidiaries** |
| ABVC BioPharma, Inc. ("ABVC") | Sole shareholder of BioKey Cayman |
| BioLite Inc. ("BioLite") | A majorly owned subsidiary of ABVC |
| AiBtl BioPharma Inc. ("AiBtl") | A majorly owned subsidiary of ABVC |
| Rgene Corporation (the "Rgene") | The Chairman of Rgene is Mr. Tsung-Shann Jiang |

---

<u>Operating sublease income – related parties</u>

During the three months ended March 31, 2026 and 2025, the Company sublease certain facility and office spaces to ABVC and AiBtl. The sublease income recognized is as follows:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31,<br> (Unaudited)** | **Three Months Ended <br> March 31,<br> (Unaudited)** |
|  | **2026** | **2025** |
| ABVC | $3000 | $2400 |
| AiBtl | 3000 | 3000 |
| Total | $6000 | $5400 |

---

<u>Due from related parties</u>

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026<br> (Unaudited)** | **December 31,<br> 2025** |
| AiBtl | $12558 | $24558 |

---

Amount due from AiBtl includes unpaid sublease rent receivable and certain operating expenses paid on behalf of AiBtl.

<u>Due to related parties</u>

Amount due to related parties consisted of the following as of the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026**<br> **(Unaudited)** | **December 31,<br> 2025** |
| ABVC <sup>(1)</sup> | $4236258 | $4089971 |
| BioLite <sup>(2)</sup> | 208798 | 208798 |
| Total | $**4445056** | $**4298769** |

---

---

| | | |
|:---|:---|:---|
| Accrued interest payable to ABVC <sup>(1)</sup> | $625342 | $583847 |

---

<sup>(1)</sup> Since 2020, the Company has been relying on ABVC's recurring loans to support the Company's operation. These loans bore an interest rate of 1.5% to 6.5% per annum. As of March 31, 2026 and December 31, 2025, the loan principal are amounted to $2,669,911 and $2,629,911, respectively. The remaining balances are accrued interest and operating expenses paid by ABVC on behalf of the Company. ABVC is not intended to demand the loan in the near future.

<sup>(2)</sup> Mainly payables to clinical development services, offsetting by certain payments made by the Company on behalf of BioLite. The advances bear no interest.

**7. INCOME TAXES**

Since the Company has not generated operating profits during the reporting periods, there is no income tax expenses or benefits recognized for the three months periods ended March 31, 2026 and 2025, respectively.

The income tax expense applicable to income before income taxes consists of the following

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31, <br> (Unaudited)** | **Three Months Ended <br> March 31, <br> (Unaudited)** |
|  | **2026** | **2025** |
| Current income taxes: |  |  |
| &nbsp;&nbsp;&nbsp;Federal |  |  |
| &nbsp;&nbsp;&nbsp;State |  |  |
| &nbsp;&nbsp;&nbsp;Foreign |  |  |
| Total Current |  |  |
| Deferred income taxes: |  |  |
| &nbsp;&nbsp;&nbsp;Federal |  |  |
| &nbsp;&nbsp;&nbsp;State |  |  |
| &nbsp;&nbsp;&nbsp;Foreign |  |  |
| Total deferred |  |  |
| Income tax expenses |  |  |

---

Loss before income tax consists of the following

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31, <br> (Unaudited)** | **Three Months Ended <br> March 31, <br> (Unaudited)** |
|  | **2026** | **2025** |
| U.S. | (207726) | (152986) |
| Loss before income tax | $(207726) | $(152986) |

---

The income tax expense (benefit) differs from the amount computed by applying the US federal statutory rate of 21.0% to income before income taxes for three months ended March 31, 2026 and 2025, respectively, as follows:

---

| | | |
|:---|:---|:---|
|  | **Three months ended**<br> **March 31, 2026**<br> **(Unaudited)** | **Three months ended**<br> **March 31, 2026**<br> **(Unaudited)** |
| US Federal Statutory Tax Rate | (43623) | 21.0% |
| State and Local Income Taxes, net of Federal Income Tax Effect | (18362) | 8.8% |
| Foreign tax effects |  | -% |
| Effect of Cross-boarder tax laws |  | -% |
| Tax credits |  | -% |
| Nontaxable or non-deductible items |  | -% |
| Change in valuation allowances | 61985 | (29.8)% |
| Others <sup>(1)</sup> | - | -% |
| Income tax expenses | **-** | **-%** |

---

---

| | | |
|:---|:---|:---|
|  | **Three months ended**<br> **March 31, 2025**<br> **(Unaudited)** | **Three months ended**<br> **March 31, 2025**<br> **(Unaudited)** |
| US Federal Statutory Tax Rate | (32127) | 21.0% |
| State and Local Income Taxes, net of Federal Income Tax Effect | (13524) | 8.8% |
| Foreign tax effects |  | -% |
| Effect of Cross-boarder tax laws |  | -% |
| Tax credits |  | -% |
| Nontaxable or non-deductible items |  | -% |
| Change in valuation allowances | 45651 | (29.8)% |
| Others <sup>(1)</sup> | - | -% |
| Income tax expenses | **-** | **-%** |

---

<sup>(1)</sup> includes the tax effects of enactment of new tax laws and change in unrecognized tax benefits.

The amount of cash paid for income taxes (net of refunds) for the three months ended March 31, 2026 and 2025 is as follows:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> March 31, <br> (Unaudited)** | **Three Months Ended <br> March 31, <br> (Unaudited)** |
|  | **2026** | **2025** |
| Federal |  |  |
| State |  |  |
| Total Current |  |  |

---

Deferred tax assets (liability) as of March 31, 2026 and December 31, 2025 consist approximately of:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026**<br>**(Unaudited)** | **December 31,**<br>**2025** |
| Net operating loss carryforwards | $1565851 | $1503866 |
| Operating lease liabilities | 350606 | 363180 |
| Operating lease assets | (347185) | (362125) |
| Deferred tax assets, Gross | 1569272 | 1504921 |
| Valuation allowance | (1569272) | (1504921) |
| Deferred tax assets, net | $**-** | $**-** |

---

A reconciliation of gross unrecognized tax benefits is as follows:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2026**<br>**(Unaudited)** | **December 31,**<br>**2025** |
| Balance at beginning of the period | $1503866 | $1293207 |
| Increases in tax positions for current year-loss carryforward | 61985 | 45651 |
| Balance at ending of the period | $**1565851** | $**1338858** |

---

**8. EQUITY**

The Company has Common stock, $0.0001 par value, 50,000,000 shares authorized, 30,000,000 and 30,000,000 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively.

**9. LEASE**

The Company adopted ASC 842 on January 1, 2019 using the modified retrospective approach and elected the transition practical expedient not to restate comparative periods. In applying the standard, the Company elected several practical expedients, including not reassessing whether existing or expired contracts contained leases, not reassessing prior lease classifications or initial direct costs, using hindsight when evaluating lease terms and potential impairments, and not reevaluating pre-existing land easements accounted for under ASC 840. The Company also elected the short-term lease exemption and generally accounts for lease and non-lease components separately.

Under ASC 842, the Company recognizes right-of-use ("ROU") assets and corresponding lease liabilities on the consolidated balance sheets. ROU assets represent the right to use the underlying leased assets over the lease term, and lease liabilities represent the present value of future minimum lease payments. Because most leases do not provide an implicit rate, the Company uses its incremental borrowing rate at lease commencement to measure lease liabilities. Future minimum lease payments primarily include fixed base rent obligations.

The Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months. The ROU assets were adjusted per ASC 842 transition guidance for existing lease-related balances of accrued and prepaid rent, unamortized lease incentives provided by lessors, and restructuring liabilities. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in Selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

The Company has no finance leases. The Company's leases primarily include various office and laboratory spaces, copy machine, and vehicles under various operating lease arrangements. The Company's operating leases have remaining lease terms of up to approximately five years.

---

| | | |
|:---|:---|:---|
|  | **March 31, 2026<br> (Unaudited)** | **December 31,<br> 2025** |
| **ASSETS** | | |
| Operating lease right-of-use assets | $1653263 | $1724404 |
| **LIABILITIES** |  |  |
| Operating lease liabilities (current) | 287601 | 271187 |
| Operating lease liabilities (non-current) | 1381952 | 1458243 |

---

***Supplemental Information***

The following provides details of the Company's lease expenses:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended<br> March 31,<br> (Unaudited)** | **Three Months Ended<br> March 31,<br> (Unaudited)** |
|  | **2026** | **2025** |
| Operating lease expenses | $131493 | $97546 |
| Short-term lease expenses |  |  |
| Total lease expenses | $131493 | $97546 |

---

Other information related to leases is presented below:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended<br> March 31,<br> (Unaudited)** | **Three Months Ended<br> March 31,<br> (Unaudited)** |
|  | **2026** | **2025** |
| Cash paid for amounts included in the measurement of operating lease liabilities | $25206 | $48773 |
| Rent paid in ABVC's common stock included in the measurement of operating lease liabilities | 106287 | 48773 |

---

---

| | | |
|:---|:---|:---|
|  | **As of<br> March 31,<br> 2026<br> (Unaudited)** | **As of<br> December 31,<br> 2025** |
| Weighted Average Remaining Lease Term: |  |  |
| Operating leases | 4.89 years | 5.13 years |
| Weighted Average Discount Rate: |  |  |
| Operating leases | 7.57% | 7.61% |

---

The minimum future annual payments under non-cancellable leases during the next five years and thereafter, at rates now in force, are as follows:

---

| | |
|:---|:---|
|  | **Operating <br> leases** |
| 2026(Excluding current period) | 296347 |
| 2027 | 393554 |
| 2028 | 398550 |
| 2029 | 410506 |
| 2030 | 422821 |
| Thereafter | 70813 |
| Total future minimum lease payments, undiscounted | 1992591 |
| Less: Imputed interest | (323038) |
| Present value of future minimum lease payments | $1669553 |

---

**10. COMMITMENTS AND CONTINGENCIES**

In the ordinary course of business, the Company may be subject to legal proceedings regarding contractual and employment relationships and a variety of other matters. The Company records contingent liabilities resulting from such claims, when a loss is assessed to be probable, and the amount of the loss is reasonably estimable. In the opinion of management, there were no pending or threatened claims and litigation as of March 31, 2026, and up through the date of the consolidated financial statements was available to the issued.

**11. SUBSEQUENT EVENTS**

The Company has assessed all events from March 31, 2026, up through the date that these consolidated financial statements are available to be issued, and concluded that no subsequent events have occurred that would require recognition or disclosure in the Company's consolidated financial statements.

**BioKey (Cayman), Inc.**

**Ordinary Shares**

(par value $0.0001 per share)

**INFORMATION STATEMENT**

**The date of this Information Statement is May 27, 2026**