Document:

Yayi International Inc.: Exhibit 10.1 - Prepared by newsfilecorp.com

Exhibit 10.1

YAYI INTERNATIONAL INC.  

2010 EMPLOYEE STOCK OPTION AND STOCK AWARD PLAN
 

1.
Purpose. 

The purpose of the
Yayi International Inc. 2010 Employee Stock Option and Stock Award Plan (the "Plan")
is to enhance the long-term stockholder value of Yayi International Inc., a
Delaware corporation (the "Company"),
by offering opportunities to employees and directors of the Company and its
Subsidiaries (as defined in Section 2) to participate in the Company's growth
and success, and to encourage them to remain in the service of the Company and
its Subsidiaries and to acquire and maintain stock ownership in the Company.

2.
Definitions. 

For purposes of the
Plan, the following terms shall be defined as set forth below: 

2.1
"Award"
means an award or grant made pursuant to the Plan, including, awards or grants
of Options or Incentive Stock Awards. 

2.2
"Board"
means the Board of Directors of the Company. 

2.3
"Cause"
means dishonesty, fraud, misconduct, unauthorized use or disclosure of
confidential information or trade secrets, or conviction or confession of a
crime punishable by law (except minor violations), as provided under applicable
law, in each case as determined by the Plan Administrator, and its determination
shall be conclusive and binding. 

2.4
"Code" means the United States
Internal Revenue Code of 1986, as amended from time to time.

2.5
"Common
Stock" means the common stock, par value $.001 per share, of the
Company. 

2.6
"Disability"
means "permanent and total disability" as that term is defined for purposes of
Section 22(e)(3) of the Code. 

2.7
"Exchange
Act" means the United States Securities Exchange Act of 1934, as
amended. 

2.8
"Fair
Market Value" shall be established in good faith by the Plan
Administrator or if the Common Stock is listed on the Nasdaq Global Market or
the Nasdaq Capital Market, the average of the high and low per share sales
prices for the Common Stock as reported by the Nasdaq Global Market or the
Nasdaq Capital Market (as the case may be) for a single trading. If there is no
such reported price for the Common Stock for the date in question, then such
price on the last preceding date for which such price exists shall be
determinative of the Fair Market Value. Notwithstanding anything in this Plan to
the contrary, to the extent applicable, the determination of the Fair Market
Value of a share of Common Stock shall be 
determined in a manner which complies with
Section 409A of the Code and the applicable Treasury Regulations promulgated
thereunder. 

1 

2.9
"Grant Date" means the date
the Plan Administrator adopted the granting resolution and all conditions
precedent to the grant have been satisfied; provided that conditions to the
exercisability or vesting of Awards shall not defer the Grant Date. If, however,
the Plan Administrator designates in a resolution a later date as the date an
Award is to be granted, then such later date shall be the "Grant
Date." 

2.10
"Incentive Stock Award"
means an Option to purchase Common Stock granted under Section 7. 

2.11
"Nonqualified
Stock Option" means an Option to purchase Common Stock granted under
Section 7. 

2.12
"Option"
means the right to purchase Common Stock granted under Section 7. 

2.13
"Participant"
means (a) the person to whom an Award is granted; (b) for a Participant who has
died, the personal representative of the Participant's estate, the person(s) to
whom the Participant's rights under the Award have passed by will or by the
applicable laws of descent and distribution, or the beneficiary designated in
accordance with Section 9; or (c) person(s) to whom an Award has been
transferred in accordance with Section 9. 

2.14
"Plan
Administrator" means the Board or a committee (which term includes
subcommittees) appointed by the Board to administer the Plan under Section 3.1.

2.15
"PRC"
means the People's Republic of China, which, for the purpose of this Plan, shall
exclude Hong Kong, the Macau Special Administrative Region of the PRC and
Taiwan. 

2.16
"Restricted Stock Award" means
shares of Common Stock granted under Section 8, the rights of ownership of which
may be subject to restrictions prescribed by the Plan Administrator.

2.17
"Retirement"
means retirement on or after the individual's normal retirement date under PRC
law or the law of such individual's other jurisdiction of employment unless
otherwise defined by the Plan Administrator from time to time for purposes of
the Plan. 

2.18
"Securities
Act" means the United States Securities Act of 1933, as amended. 

2.19
"Subsidiary"
means any entity that is directly or indirectly controlled by the Company or in
which the Company has a significant ownership interest, as determined by the
Plan Administrator, and any entity that may become a direct or indirect
subsidiary of the Company. 

2 

2.20
"Termination" means the
termination of the Participant's relationship as an officer, director or
employee, or as a service provider to the Company.

3.
Administration. 

3.1
Plan Administrator.
The Plan shall be administered by the Board or a committee (which term includes
subcommittees) appointed by the Board. If and so long as the Common Stock is
registered under Section 12(b) or 12(g) of the Exchange Act, the Board shall
consider in selecting the Plan Administrator and the membership of any committee
acting as Plan Administrator, with respect to any persons subject or likely to
become subject to Section 16 of the Exchange Act, the provisions regarding "non
employee directors" as contemplated by Rule 16b-3 under the Exchange Act. The
Plan Administrator may delegate the responsibility for administering the Plan
with respect to designated classes of eligible persons to different committees
consisting of one or more members of the Board, subject to such limitations as
the Board deems appropriate. Committee members shall serve for such term as the
Board may determine, subject to removal by the Board at any time. To the extent
consistent with applicable law, the Plan Administrator may authorize one or more
officers of the Company to grant Awards to designated classes of eligible
persons, within the limits specifically prescribed by the Plan Administrator.

3.2
Administration and
Interpretation by the Plan Administrator. Except for the terms and
conditions explicitly set forth in the Plan, the Plan Administrator shall have
exclusive authority, in its discretion, to determine all matters relating to
Awards under the Plan, including the selection of individuals to be granted
Awards, the type of Awards, the number of shares of Common Stock subject to an
Award, all terms, conditions, restrictions and limitations, if any, of an Award
and the terms of any instrument that evidences the Award. The Plan Administrator
shall also have exclusive authority to interpret the Plan and may from time to
time adopt, and change, rules and regulations of general application for the
Plan's administration. The Plan Administrator's interpretation of the Plan and
its rules and regulations, and all actions taken and determinations made by the
Plan Administrator pursuant to the Plan, shall be conclusive and binding on all
parties involved or affected. The Plan Administrator may delegate administrative
duties to such of the Company's officers as it so determines. 

4.
Stock Subject to the Plan.

4.1
Authorized Number of
Shares. Subject to adjustment from time to time as provided in Section 10.1,
the number of shares of Common Stock that shall be available for issuance under
the Plan shall be 2,359,974 shares. The maximum aggregate number of shares of
Common Stock that may be issued under the Plan pursuant to the exercise or
vesting of Awards shall be the number determined pursuant to the preceding
sentence, as adjusted from time to time pursuant to Section 10.1. Shares issued
under the Plan shall be drawn from authorized and unissued shares or shares now
held or subsequently acquired by the Company as treasury shares. 

4.2
Reuse of Shares. Any
shares of Common Stock that have been made subject to an Award that cease to be
subject to the Award (other than by reason of exercise or payment of the Award
to the extent it is exercised for or settled in shares), and/or shares of Common
Stock subject to repurchase or forfeiture which are subsequently reacquired by
the Company, shall again be available for issuance in connection with future
grants of Awards under the Plan. 

3 

5.
Eligibility. 

Awards may be granted
under the Plan to those officers, directors and employees of the Company and its
Subsidiaries as the Plan Administrator from time to time selects. Awards may
also be granted to consultants, agents, advisors and independent contractors who
provide services to the Company and its Subsidiaries. 

6.
Awards. 

6.1
Form and Grant of Awards.
The Plan Administrator shall have the authority, in its sole discretion, to
determine the type or types of Awards to be made under the Plan. Such Awards may
include Nonqualified Stock Options or Incentive Stock Awards. Awards may be
granted singly or in combination. 

6.2
Settlement of Awards.
The Company may settle Awards through the delivery of shares of Common Stock,
cash payments, the granting of replacement Awards or any combination thereof as
the Plan Administrator shall determine. Any Award settlement, including payment
deferrals, may be subject to such conditions, restrictions and contingencies as
the Plan Administrator shall determine. The Plan Administrator may permit or
require the deferral of any Award payment, subject to such rules and procedures
as it may establish, which may include provisions for the payment or crediting
of interest, or dividend equivalents, including converting such credits into
deferred stock equivalents. 

7.
Terms and Conditions of
Awards. 

7.1
Grant of Awards. The
Plan Administrator is authorized under the Plan, in its sole discretion, to
issue Awards, which shall be appropriately designated. 

7.2
Exercise Price. The
exercise price for shares purchased under an Award shall be as determined by the
Plan Administrator. 

7.3
Term. The term of each
Award shall be as established by the Plan Administrator or, if not so
established, shall be 10 years from the Grant Date. 

7.4
Exercise and Vesting.
The Plan Administrator shall establish and set forth in each instrument that
evidences an Award the time at which, or the installments in which, the Award
shall vest and become exercisable, which provisions may be waived or modified by
the Plan Administrator at any time. To the extent that an Award has become
exercisable, the Award may be exercised from time to time by written notice to
the Company, in accordance with procedures established by the Plan
Administrator, setting forth the number of shares with respect to which the
Award is being exercised and accompanied by payment in full as described in
Section 7.6. The Plan Administrator may determine at any time that an Award may
not be exercised as to less than any number of shares at any one time for vested
shares and any number in its discretion for unvested shares (or the lesser
number of remaining shares covered by the Award). 

4 

7.5
Performance Conditions.
The Plan Administrator is authorized to subject an Award to performance
requirements (which may be based on continuous service with the Company or the
achievement of performance goals related to profits or loss, revenue or profit
growth or loss reduction, profit or loss related return ratios, other balance
sheet or income statement targets or ratios, market share, project completion,
operational or productivity efficiency gains, cash flow, share price
appreciation or total stockholder return, where such goals may be stated in
absolute terms or relative to comparison companies), as the Plan Administrator
shall determine, in its sole discretion, must be satisfied as a condition of the
Award becoming vested and exercisable. Such performance requirements shall be
set forth in the instrument evidencing the Award. 

7.6
Payment of Exercise Price.
The exercise price for shares purchased under an Award shall be paid in full to
the Company by delivery of consideration equal to the product of the Award
exercise price and the number of shares purchased. Such consideration must be
paid in cash unless the Company adopts a "cashless" exercise method. 

7.7
Post-Termination
Exercises. The Plan Administrator shall establish and set forth in each
instrument that evidences an Award whether the Award will continue to be
exercisable, and the terms and conditions of such exercise, if a Participant
ceases to be employed by, or to provide services to, the Company or its
Subsidiaries, which provisions may be waived or modified by the Plan
Administrator at any time. If not so established in the instrument evidencing
the Award, the Award will be exercisable according to the following terms and
conditions, which may be waived or modified by the Plan Administrator at any
time. 

In case of
termination of the Participant's employment or services other than by reason of
death or Cause, the Option shall be exercisable, to the extent of the number of
shares vested at the date of such termination, only (a) within one year if the
termination of the Participant's employment or services is coincident with
Retirement, at the Company's request or Disability or (b) within three months
after the date the Participant ceases to be an employee or director of the
Company or a Subsidiary if termination of the Participant's employment or
services is for any reason other than Retirement, at the Company's request or
Disability, but in no event later than the remaining term of the Option. Any
Option exercisable at the time of the Participant's death may be exercised, to
the extent of the number of shares vested at the date of the Participant's
death, by the personal representative of the Participant's estate, the person(s)
to whom the Participant's rights under the Option have passed by will or the
applicable laws of descent and distribution or the beneficiary designated
pursuant to Section 9 at any time or from time to time within one year after the
date of death, but in no event later than the remaining term of the Option. Any
portion of an Option that is not vested on the date of termination of the
Participant's employment or services shall terminate on such date, unless the
Plan Administrator determines otherwise. In case of termination of the
Participant's employment or services for Cause, the Option shall automatically
terminate upon first notification to the Participant of such termination, unless
the Plan Administrator determines otherwise. If a Participant's employment or
services with the Company are suspended pending an investigation of whether the
Participant shall be terminated for Cause, all the Participant's rights under
any Option likewise shall be suspended during the period of investigation.

5 

7.8
Leave of Absence.
Unless otherwise determined by the Plan Administrator, for purpose of this
Section 7, the service of a Participant shall be deemed to continue while the
Participant is on a bona fide leave of absence, if such leave was approved by
the Company in writing. Unless otherwise determined by the Plan Administrator
and subject to applicable laws, vesting of an Option shall be suspended during
any unpaid leave of absence. 

7.9
Prohibition on Repricing.
An option issued under the Plan may not, without prior approval of the
Company's stockholders at a duly-constituted meeting, be repriced by lowering
the exercise price or by cancellation of an outstanding Award with a subsequent
replacement or re-grant of an option with a lower exercise price. 

7.10
Incentive Stock Awards.
The Plan Administrator may designate an Award as an Incentive Stock Award, in
which case it may not be subject to time-based vesting but instead subject only
to specific performance conditions to become vested and exercisable, as
designated by the Plan Administrator and forth in the instrument evidencing the
Award. For removal of doubt, an Incentive Stock Award is not intended to be an
Incentive Stock Option under the Code. 

8.
Restricted Stock Awards

8.1
Grant of Restricted Stock Awards. The
Plan Administrator is authorized to make Awards of Common Stock on such terms
and conditions and subject to such restrictions and/or requirements, as the Plan
Administrator shall determine, in its sole discretion, which terms, conditions
and restrictions shall be set forth in the instrument evidencing the Award. The
terms, conditions and restrictions that the Plan Administrator shall have the
power to determine shall include, without limitation, the manner in which shares
subject to Restricted Stock Awards are held during the periods they are subject
to restrictions and the circumstances under which forfeiture of the Restricted
Stock Award shall occur by reason of termination of the Participant's employment
or service relationship.

8.2
Issuance of Shares. Upon the
satisfaction of any terms, conditions and restrictions prescribed in respect to
a Restricted Stock Award, or upon the Participant's release from any terms,
conditions and restrictions of a Restricted Stock Award, as determined by the
Plan Administrator, the Company shall release, as soon as practicable, to the
Participant or, in the case of the Participant's death, to the personal
representative of the Participant's estate or as the appropriate court directs,
the appropriate number of shares of Common Stock.

8.3
Waiver of Restrictions.
Notwithstanding any other provisions of the Plan, the Plan Administrator may, in
its sole discretion, waive the forfeiture period and any other terms, conditions
or restrictions on any Restricted Stock Award under such circumstances and
subject to such terms and conditions as the Plan Administrator shall deem
appropriate; provided, however, that the Plan Administrator may not
adjust performance goals for any Restricted Stock Award intended to be exempt
under Section 162(m) of the Code for the year in which the Restricted Stock
Award is settled in such a manner as would increase the amount otherwise payable
to a Participant.

6 

9.
Assignability. 

No Awards granted under the Plan or any
interest therein may be assigned, pledged or transferred by the Participant
other than by will or by the applicable laws of descent and distribution, and,
during the Participant's lifetime, such Award may be exercised only by the
Participant or a permitted assignee or transferee of the Participant (as
provided below). 

10.
Adjustments. 

10.1
Adjustment of Shares.
In the event that, at any time or from time to time, a stock dividend, stock
split, spin-off, combination or exchange of shares, recapitalization, merger,
consolidation, distribution to stockholders other than a normal cash dividend,
or other change in the Company's corporate or capital structure results in (a)
the outstanding shares, or any securities exchanged therefor or received in
their place, being exchanged for a different number or class of securities of
the Company or of any other corporation or (b) new, different or additional
securities of the Company or of any other corporation being received by the
holders of shares of Common Stock of the Company, then the Plan Administrator
shall make proportional adjustments in (i) the maximum number and kind of
securities subject to the Plan as set forth in Sections 4.1; and (ii) the number
and kind of securities that are subject to any outstanding Award and the per
share price of such securities, without any change in the aggregate price to be
paid therefor. The determination by the Plan Administrator as to the terms of
any of the foregoing adjustments shall be conclusive and binding. 

10.2
Limitations. The grant
of Awards will in no way affect the Company's right to adjust, reclassify,
reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its
business or assets. 

10.3
Fractional Shares. In
the event of any adjustment in the number of shares covered by any Award, each
such Award shall cover only the number of full shares resulting from such
adjustment. 

11.
Withholding. 

The Company may require the
Participant to pay to the Company the amount of any taxes or social insurance
contributions that the Company is required to withhold with respect to the
grant, vesting or exercise of any Award. Subject to the Plan and applicable law,
the Plan Administrator may, in its sole discretion, permit the Participant to
satisfy withholding obligations, in whole or in part, (a) by paying cash, (b) by
electing to have the Company withhold shares of Common Stock (up to the minimum
required federal withholding rate), or (c) by transferring shares of Common
Stock to the Company (already owned by the Participant for the period necessary
to avoid a charge to the Company's earnings for financial reporting purposes),
in such amounts as are equivalent to the Fair Market Value of the withholding
obligation. The Company shall have the right to withhold from any shares of
Common Stock issuable pursuant to an Award or from any cash amounts otherwise
due or to become due from the Company to the Participant an amount equal to such
taxes or social insurance contributions. The Company may also deduct from any
Award any other amounts due from the Participant to the Company or a Subsidiary.

7 

12.
Amendment and Termination of
Plan. 

12.1
Amendment of Plan. The
Plan may be amended only by the Board in such respects as it shall deem
advisable; however, to the extent required for compliance with any applicable
law or regulation, stockholder approval will be required for any amendment that
will (a) increase the total number of shares available for issuance under the
Plan, (b) modify the class of persons eligible to receive Awards, or (c)
otherwise require stockholder approval under any applicable law or regulation.

12.2
Termination of Plan.
The Board may suspend or terminate the Plan at any time. 

12.3
Consent of Participant.
The amendment or termination of the Plan shall not, without the consent of the
Participant, impair or diminish any rights or obligations under any Award
theretofore granted under the Plan. 

13.
General. 

13.1
Evidence of Awards.
Awards granted under the Plan shall be evidenced by a written agreement that
shall contain such terms, conditions, limitations and restrictions as the Plan
Administrator shall deem advisable and that are not inconsistent with the Plan.

13.2
Continued Employment or
Services; Rights in Awards. None of the Plan, participation in the Plan or
any action of the Plan Administrator taken under the Plan shall be construed as
giving any person any right to be retained in the employ of the Company or limit
the Company's right to terminate the employment or services of any person.

13.3
Registration. The
Company shall be under no obligation to any Participant to register for offering
or resale or to qualify for exemption under the Securities Act, or to register
or qualify under state securities laws, any shares of Common Stock, security or
interest in a security paid or issued under, or created by, the Plan, or to
continue in effect any such registrations or qualifications if made. 

The Company may issue
certificates for shares with such legends and subject to such restrictions on
transfer and stop-transfer instructions as counsel for the Company deems
necessary or desirable for compliance by the Company with U.S. federal and state
securities laws. 

Inability of the
Company to obtain, from any regulatory body having jurisdiction, the authority
deemed by the Company's counsel to be necessary for the lawful issuance and sale
of any shares hereunder or the unavailability of an exemption from registration
for the issuance and sale of any shares hereunder shall relieve the Company of
any liability in respect of the nonissuance or sale of such shares as to which
such requisite authority shall not have been obtained. 

As a condition to the
exercise of an Award, the Company may require the Participant to represent and
warrant at the time of any such exercise or receipt that such shares are being
purchased or received only for the Participant's own account and without any
present  intention to sell or distribute such shares if, in the opinion of
counsel for the Company, such a representation is required by any relevant
provision of the aforementioned laws. At the option of the Company, a
stop-transfer order against any such shares may be placed on the official stock
books and records of the Company, and a legend indicating that such shares may
not be pledged, sold or otherwise transferred, unless an opinion of counsel is
provided (concurred in by counsel for the Company) stating that such transfer is
not in violation of any applicable law or regulation, may be stamped on stock
certificates to ensure exemption from registration. The Plan Administrator may
also require such other action or agreement by the Participant as may from time
to time be necessary to comply with the federal and state securities laws. No
Rights as A Stockholder. No Award shall entitle the Participant to any
dividend, voting or other right of a stockholder unless and until the date of
issuance under the Plan of the shares that are the subject of such Award, free
of all applicable restrictions. 

8 

13.4
Compliance with Laws And
Regulations. No Shares of Common Stock shall be issued pursuant to an Award
unless such issuance complies with all applicable laws and regulations.
Notwithstanding anything in the Plan to the contrary, the Board, in its sole
discretion, may bifurcate the Plan so as to restrict, limit or condition the use
of any provision of the Plan to Participants who are officers or directors
subject to Section 16 of the Exchange Act without so restricting, limiting or
conditioning the Plan with respect to other Participants. 

13.5
No Trust or Fund. The
Plan is intended to constitute an "unfunded" plan. Nothing contained herein
shall require the Company to segregate any monies or other property, or shares
of Common Stock, or to create any trusts, or to make any special deposits for
any immediate or deferred amounts payable to any Participant, and no Participant
shall have any rights that are greater than those of a general unsecured
creditor of the Company. 

13.6
Severability. If any
provision of the Plan or any Award is determined to be invalid, illegal or
unenforceable in any jurisdiction, or as to any person, or would disqualify the
Plan or any Award under any law deemed applicable by the Plan Administrator,
such provision shall be construed or deemed amended to conform to applicable
laws, or, if it cannot be so construed or deemed amended without, in the Plan
Administrator's determination, materially altering the intent of the Plan or the
Award, such provision shall be stricken as to such jurisdiction, person or
Award, and the remainder of the Plan and any such Award shall remain in full
force and effect. 

13.7
Participants In Foreign
Countries. The Plan Administrator shall have the authority to adopt such
modifications, procedures and sub-plans as may be necessary or desirable, after
consideration of the provisions of the laws of the PRC or other foreign
countries in which the Company or its Subsidiaries may operate, to ensure the
viability of the benefits from Awards granted to Participants employed in such
countries and to meet the objectives of the Plan. The Plan Administrator may
restrict the issuance of shares of Common Stock pursuant to any Awards or delay
the removal of restrictions on shares of Common Stock pursuant to any Awards
until it determines in its discretion that the Company or its Subsidiaries has
satisfied the legal or regulatory procedures or requirements as may be necessary
or desirable to ensure the viability of the benefits of the Awards. 

13.8
Choice of Law. The
Plan and all determinations made and actions taken pursuant hereto, to the
extent not otherwise governed by the federal laws of the United States, shall be
governed by the laws of the State of Delaware without giving effect to
principles of conflicts of laws. 

14.
Effective Date. 

The Plan's effective date is the date
on which it is adopted by the Board. 

9Yayi International Inc.: Exhibit 10.2 - Prepared by newsfilecorp.com

Exhibit 10.2

YAYI INTERNATIONAL INC. 

2010 EMPLOYEE STOCK OPTION AND STOCK AWARD PLAN

AWARD AGREEMENT 

Yayi International
Inc., a Delaware corporation (the "Company"), has granted to the Participant
named on the Notice of Grant of Options (the "Notice of Grant"), which is
attached hereto, an option (the "Option") to purchase that number of shares
("Shares") set forth on the Notice of Grant at the exercise price per Share set
forth on the Notice of Grant (the "Exercise Price"), subject to all of the
terms, definitions and provisions in this Yayi International Inc. 2010 Employee
Stock Option and Stock Award Plan Award Agreement ("Agreement") and the
Company's 2010 Employee Stock Option and Stock Award Plan (as applicable, the
"Plan"), which is incorporated herein by reference. In the event of a conflict
between the terms and conditions of the Plan and the terms and conditions of
this Agreement, the terms and conditions of the Plan shall prevail. The terms
defined in the Plan shall have the same defined meanings in this Agreement.

1.
Nature of Option. This Option
is not intended to qualify as an Incentive Stock Option under Section 422 of the
Code. This Option is intended to be a Nonstatutory Stock Option. 

2.
Vesting Schedule. Subject to
the Performance Conditions provided in Section 3, the Option awarded by this
Agreement shall vest in accordance with the vesting provisions set forth in the
Notice of Grant. Shares scheduled to vest on a certain date or upon the
occurrence of a certain condition shall not vest in Participant in accordance
with any of the provisions of this Agreement, unless Participant shall have been
continuously an employee of the Company or its Subsidiary ("Employee") from the
Grant Date until the date such vesting occurs. 

3.
Performance Conditions. The Option is
subject to the performance requirements set forth in 
Appendix I, which must be
satisfied as a condition of the Option becoming vested and exercisable. 

4.
Administrator Discretion. The
Plan Administrator, in its discretion, may accelerate the vesting of the
balance, or some lesser portion of the balance, of the unvested Option at any
time, subject to the terms of the Plan. If so accelerated, such Option shall be
considered as having vested as of the date specified by the Plan Administrator.

5.
Exercise of Option. This
Option may be exercised only within the term set out in the Notice of Grant, and
may be exercised during such term only in accordance with the Plan and the terms
of this Agreement. 

6.
Method of Payment. The
exercise price for Shares purchased under an Option shall be paid in full to the
Company by delivery of consideration equal to the product of the Option exercise
price and the number of Shares purchased. Such consideration must be paid in
cash unless the Company adopts any "cashless" exercise method. 

7. 
Termination Period. Subject to
applicable laws, if the Participant ceases to be an 

Employee, he or she
may, but only within three (3) months after the date Participant ceases to be an
Employee, exercise this Option to the extent that he or she was entitled to
exercise it as of the date of such cessation. To the extent he or she was not
entitled to exercise this Option as of the date of such cessation, or if he or
she does not exercise the Option within the time specified herein, the Option
shall terminate. 

Notwithstanding the
provisions above, if Participant ceases to be an employee as a result of his or
her Disability, he or she may, but only within twelve (12) months from
the date of such cessation, exercise his or her Option to the extent he or she
was entitled to exercise it at the date of cessation. To the extent that he or
she was not entitled to exercise this Option at the date of such cessation, or
if he or she does not exercise such Option within the time specified herein, the
Option shall terminate. 

In the event of the
death of the Participant during the term of this Option and while an employee,
the Option shall become fully exercisable, including as to Shares for which it
would not otherwise be exercisable, and may be exercised, at any time within 
twelve (12) months following the date of death, by Participant's estate or
by a person who acquired the right to exercise the Option by bequest or
inheritance. 

Notwithstanding the foregoing, in no
event may this Option be exercised after the expiration date as provided above.

8.
Tax Obligations. The Company
and its Subsidiaries shall assess tax and social insurance contribution
liability and requirements in connection with the Participant's participation in
the Plan, including, without limitation, tax liability and social insurance
contribution liability associated with the grant or exercise of the Option or
sale of the underlying Shares (the "Tax Liability"). These requirements may
change from time to time as laws or interpretations change. Regardless of the
Company's or any Subsidiary's actions in this regard, the Participant hereby
acknowledges and agrees that the Tax Liability shall be the Participant's
ultimate responsibility and liability. The Participant agrees as a condition of
his or her participation in the Plan to make arrangements satisfactory to the
Company and its Subsidiaries to enable it to satisfy all withholding, payment
and/or collection requirements associated with the satisfaction of the Tax
Liability, including authorizing the Company or the Subsidiary to: (i) withhold
all applicable amounts from the Participant's wages or other cash compensation
due to the Participant, in accordance with any requirements under the laws,
rules, and regulations of the country of which the Participant is a resident,
and/or (ii) act as the Participant's agent to sell sufficient Shares for the
proceeds to settle such requirements. Furthermore, the Participant agrees to pay
the Company or the Subsidiary any amount the Company or any Subsidiary may be
required to withhold, collect or pay as a result of the Participant's
participation in the Plan or that cannot be satisfied by deduction from the
Participant's wages or other cash compensation paid to the Participant by the
Company or the Subsidiary or sale of the Shares acquired under the Plan. The
Participant acknowledges that he or she may not participate in the Plan and the
Company and the Subsidiary shall have no obligation to deliver Shares until the
Tax Liability has been satisfied by the Participant. 

9. 
Rights as Stockholder. Neither
Participant nor any person claiming under or through 

Participant shall have
any of the rights or privileges of a stockholder of the Company in respect of
any Shares deliverable hereunder unless and until certificates representing such
Shares shall have been issued, recorded on the records of the Company or its
transfer agents or registrars, and delivered to Participant. After such
issuance, recordation and delivery, Participant shall have all the rights of a
stockholder of the Company with respect to voting such Shares and receipt of
dividends and distributions on such Shares. 

10.
Acknowledgments.
In accepting the Option, the Participant acknowledges that: 

(a) Any notice period
mandated under applicable laws shall not be treated as continuous service for
the purpose of determining the vesting of the Option; and the Participant's
right to receive Shares in settlement of the Option after termination of
service, if any, will be measured by the date of termination of the
Participant's service and will not be extended by any notice period mandated
under applicable laws. Subject to the foregoing and the provisions of the Plan,
the Company, in its sole discretion, shall determine whether the Participant's
service has terminated and the effective date of such termination. 

(b) The Plan is
established voluntarily by the Company. It is discretionary in nature and it may
be modified, amended, suspended or terminated by the Company at any time, unless
otherwise provided in the Plan and this Agreement. 

(c) All decisions with respect to
future Option grants, if any, will be at the sole discretion of the Company.

(d) The Participant's participation
in the Plan shall not create a right to continued service with the Company (or
any Subsidiary). 

(e) The Participant is voluntarily
participating in the Plan. 

(f) The Option is an
extraordinary item that does not constitute compensation of any kind for service
of any kind rendered to the Company (or any Subsidiary), and which is outside
the scope of the Participant's employment contract, if any. 

(g) The Option is not
part of normal or expected compensation or salary for any purpose, including,
but not limited to, calculating any severance payments, resignation,
termination, redundancy, end-of-service payments, bonuses, long-service awards,
pension or retirement benefits or similar payments. This applies to any payment
even in those jurisdictions requiring such payments upon termination of
employment. 

(h) In the event that
the Participant is not an employee of the Company, the Option grant will not be
interpreted to form an employment contract or relationship with the Company; and
furthermore the Option grant will not be interpreted to form an employment
contract with any Subsidiary . 

(i) The future value
of the underlying Shares is unknown and cannot be predicted with certainty. If
the Participant obtains Shares upon exercise of the Option, the value of those
Shares may increase or decrease. 

11.
Address for Notices. Any notice to be given
to the Company under the terms of this Agreement shall be addressed to the
Company at Xingguang Road No. 9, Northern Industrial Park of Zhongbei Town,
Xi Qing District, Tianjin City, 300380, China or at such other address as
the Company may hereafter designate in writing. 

12.
Grant is Not Transferable.
This Option may not be transferred in any manner otherwise than by will or by
the laws of descent or distribution and may be exercised during the lifetime of
Participant only by Participant. 

13.
Binding Agreement. Subject to
the limitation on the transferability of this grant contained herein, this
Agreement shall be binding upon and inure to the benefit of the heirs, legatees,
legal representatives, successors and assigns of the parties hereto. 

14.
Data Privacy Consent. 
The Participant hereby explicitly
and unambiguously consents to the collection, use and transfer, in electronic or
other form, of the Participant's personal data as described in this document by
and among the Company and each Subsidiary for the exclusive purpose of
implementing, administering and managing the Participant's participation in the
Plan. 

(a) The Participant
understands that the Company (or any Subsidiary) holds certain personal
information about the Participant, including, but not limited to, the
Participant's name, home address and telephone number, date of birth, social
insurance number or other identification number, salary, nationality, job title,
any shares or directorships held in the Company, details of all Options or any
other entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in the Participant's favor, for the purpose of implementing,
administering and managing the Plan ("Data"). 

(b) The Participant
understands that Data may be transferred to any third parties assisting in the
implementation, administration and management of the Plan, that these recipients
may be located in the Participant's country or elsewhere, and that the
recipient's country may have different data privacy laws and protections than
the Participant's country. The Participant understands that he or she may
request a list with the names and addresses of any potential recipients of the
Data by contacting the Participant's local human resources representative. The
Participant authorizes the recipients to receive, possess, use, retain and
transfer the Data, in electronic or other form, for the purposes of
implementing, administering and managing the Participant's participation in the
Plan, including any requisite transfer of such Data as may be required to a
broker or other third party with whom the Participant may elect to deposit any
Shares acquired upon settlement of the Option. The Participant understands that
Data will be held only as long as is necessary to implement, administer and
manage the Participant's participation in the Plan. The Participant understands
that he or she may, at any time, view Data, request additional information about
the storage and processing of Data, require any necessary amendments to Data or
refuse or withdraw the consents herein, in any case without cost, by contacting
in writing the Participant's local human resources representative. The
Participant understands, however, that refusing or withdrawing the Participant's
consent may affect the Participant's ability to participate in the Plan. For
more information on the consequences of the Participant's refusal to consent or
withdrawal of consent, the Participant understands that he or she may contact
the Participant's local human resources representative. 

15.
Additional Conditions to
Issuance of Stock. If at any time the Company shall determine, in its
discretion, that the listing, registration or qualification of the Shares upon
any securities exchange or under any national, local or applicable law, or the
consent or approval of any governmental regulatory authority is necessary or
desirable as a condition to the issuance of Shares to Participant (or his or her
estate), such issuance shall not occur unless and until such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Company. The Company shall
make all reasonable efforts to meet the requirements of any such state or
federal law or securities exchange and to obtain any such consent or approval of
any such governmental authority. 

16.
Special Administration in
China. The grant of the Option, the Participant's ability to exercise the Option
and sale of the Shares may be contingent upon the Company or any Subsidiary
obtaining approval from SAFE for the related foreign exchange transaction and
the establishment of a SAFE-approved bank account. The receipt of funds by the
Participant from the sale of the Shares and the conversion of those funds to the
local currency must be approved by SAFE. In order to comply with the SAFE
regulations, the proceeds from the sale of the Shares must be repatriated into
China through a SAFE-approved bank account set up and monitored by the Company.

17.
Currency Exchange Risk. The
Participant agrees and acknowledges that the Participant shall bear any and all
risk associated with the exchange or fluctuation of currency associated with the
Option, including without limitation the exercise of the Option or sale of the
Shares (the "Currency Exchange Risk"). The Participant waives and releases the
Company and its Subsidiaries from any potential claims arising out of the
Currency Exchange Risk. 

18.
Exchange Control
Requirements. The Participant agrees and acknowledges that the Participant shall
comply with any and all exchange control requirements applicable to the Option
and the sale of Shares and any resulting funds including, without limitation,
reporting or repatriation requirements. 

19.
Plan Governs. This Agreement
is subject to all terms and provisions of the Plan. In the event of a conflict
between one or more provisions of this Agreement and one or more provisions of
the Plan, the provisions of the Plan shall govern. Capitalized terms used and
not defined in this Agreement shall have the meaning set forth in the Plan.

20.
Administrator Authority. The
Plan Administrator shall have the power to interpret the Plan and this Agreement
and to adopt such rules for the administration, interpretation and application
of the Plan as are consistent therewith and to interpret or revoke any such
rules (including, but not limited to, the determination of whether or not any
Shares subject to the Option have vested). All actions taken and all
interpretations and determinations made by the Plan Administrator in good faith
shall be final and binding upon Participant, the Company and all other
interested persons. The Plan Administrator shall not be personally liable for
any action, determination or interpretation made in good faith with respect to
the Plan or this Agreement. The Plan Administrator shall, in its absolute
discretion, determine when such conditions have been fulfilled. 

21.
Electronic Delivery. The
Company may, in its sole discretion, decide to deliver any documents related to
Options awarded under the Plan or future Options that may be awarded under the
Plan by electronic means or request Participant's consent to participate in the
Plan by electronic means. Participant hereby consents to receive such documents
by electronic delivery and agrees to participate in the Plan through any on-line
or electronic system established and maintained by the Company or another third
party designated by the Company. 

22.
Captions. Captions provided
herein are for convenience only and are not to serve as a basis for
interpretation or construction of this Agreement. 

23.
Agreement Severable. In the
event that any provision in this Agreement shall be held invalid or
unenforceable, such provision shall be severable from, and such invalidity or
unenforceability shall not be construed to have any effect on, the remaining
provisions of this Agreement. 

24.
Modifications to the
Agreement. This Agreement constitutes the entire understanding of the parties on
the subjects covered. Participant expressly warrants that he or she is not
accepting this Agreement in reliance on any promises, representations, or
inducements other than those contained herein. Modifications to this Agreement
or the Plan can be made only in an express written contract executed by a duly
authorized officer of the Company. 

25.
Amendment, Suspension or
Termination of the Plan. By accepting this Award, Participant expressly warrants
that he or she has received an Option under the Plan, and has received, read and
understood a description of the Plan. Participant understands that the Plan is
discretionary in nature and may be amended, suspended or terminated by the
Company at any time. 

26.
Governing Law. Subject to
applicable laws, this Agreement and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by the federal laws of the
United States, shall be governed by the laws of the State of Delaware without
giving effect to principles of conflicts of laws. 

APPENDIX I 

PERFORMANCE CONDITIONS 

 

YAYI INTERNATIONAL INC. 

2010 EMPLOYEE STOCK OPTION AND STOCK AWARD PLAN

NOTICE OF GRANT 

Unless otherwise
defined herein, the terms defined in the Yayi International Inc. 2010 Employee
Stock Option and Stock Award Plan (the "Plan") will have the same defined
meanings in this Notice of Grant (the "Notice of Grant") and the Yayi
International Inc. 2010 Employee Stock Option and Stock Award Plan Award
Agreement (together, the "Agreement"). 

	

    Participant:  
    	 
	

    ID Number:  	 
	

    Address:  
    	 
	

 	 

Participant has been
granted an Option to purchase Shares of common stock, subject to the terms and
conditions of the Plan and this Agreement, as follows: 

	

    Grant Number 	 
	

    Date of Grant 	
     
	

    Vesting Commencement Date 	
     
	

    Number of Shares Granted	 
	

    Exercise Price per Share 	
     
	

    Total Exercise Price  	
    $
	

    Type of Option 	
     
	

    Term/Expiration Date 	
     
	

    Vesting Schedule:	 
	 	 

Performance Conditions  

 

By Participant's
signature and the signature of the Company's representative below, Participant
and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Agreement. Participant has reviewed
the Plan and this Agreement in their entirety, has had an opportunity to obtain
the advice of counsel prior to executing this Agreement and fully understands
all provisions of the Plan and Agreement. Participant hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Plan
Administrator upon any questions relating to the Plan and Agreement. Participant
further agrees to notify the Company upon any change in the residence address
indicated below. 

	
    PARTICIPANT	 	
    YAYI INTERNATIONAL INC. 
	 	 	 
	
    Signature	 	
     By 
	 	 	 
	
    Print Name	 	
     Title 
	 	 	 
	
    Address:

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