Asia Optical International Ltd. made a proposal to acquire an additional 72.2% stake in Yorkey Optical International (Cayman) Ltd. (SEHK:2788) from Fortune Lands International Ltd., Ability Enterprises (BVI) Co. Ltd and other shareholders for approximately HKD 520 million on October 15, 2021. The transaction will be carried out as a scheme of arrangement. Asia Optical International will pay HKD 0.88 per share as consideration. If any dividend is announced, declared or paid in respect of the shares, Asia Optical International reserves the right to reduce the cancellation price by all or any part of the amount or value of such dividend, distribution and/or, as the case may be. The scheme if approved and implemented, will involve the cancellation and extinguishment of the scheme shares and in consideration thereof, the payment of HKD 0.88 per share to the scheme shareholders whose names appear on the register on the scheme record date and upon such cancellation and extinguishment, the issued share capital of Yorkey Optical International (Cayman) Ltd. will be simultaneously increased to its former amount by the issuance at par to Asia Optical International, credited as fully paid, of the aggregate number of shares as is equal to the number of scheme shares cancelled and extinguished, while the reserve created in Yorkey Optical International's books of account as a result of the cancellation and extinguishment of the scheme shares will be applied in paying up in full at par the new shares so issued, credited as fully paid, to Asia Optical International. Prior to the transaction, Asia Optical International holds 186.83 million shares amounting to 22.89% stake and Richman International Group Co., Ltd., another wholly owned subsidiary of Asia Optical Co., Inc. holds 40 million shares amounting to 4.9% stake in Yorkey Optical International (Cayman) Ltd. After the transaction, Asia Optical International will hold 776.35 million shares amounting to 95.1% stake in Yorkey Optical International (Cayman) Ltd. After the transaction, Yorkey Optical International (Cayman) Ltd, will become an indirect wholly owned subsidiary of Asia Optical Co., Inc. The transaction shall be funded through the financing facility made available to Asia Optical International by a licensed bank in Hong Kong. DL Securities and VBG Capital, the joint financial advisers, are satisfied that sufficient financial resources are available to Asia Optical International for discharging its obligations in respect of the full implementation of the proposal. The Scheme will lapse if any of the conditions has not been fulfilled or waived (as applicable) on or before Long stop date.

Asia Optical International intends that Yorkey Optical Group will continue to carry on its current business. Asia Optical International has no intention to make any major changes to the business of the Group, including any major redeployment of fixed assets or making any material change to the continued employment of employees of the Group, other than those in the ordinary course of business of the Group. The transaction is subject to approval by a majority in number of the scheme shareholders representing not less than 75% in value of the scheme shares held by the scheme shareholders, approval from the Investment Commission of the Ministry of Economic Affairs of Taiwan, the sanction of the scheme by the Grand Court, compliance, to the extent necessary, with the procedural requirements and conditions, if any, under Sections 15 and 16 of the Companies Act in relation to the reduction of the issued share capital of Yorkey Optical International (Cayman) Ltd. involved in the scheme, all necessary statutory or regulatory obligations in all relevant jurisdictions having been complied with and from the announcement date up to the date when all conditions are satisfied or waived (as applicable) and there having been no adverse change in the business, assets, financial or trading positions, profits or prospects of any member of Yorkey Optical Group. Asia Optical has applied to Ministry of Economic Affairs for approving the transaction. Asia Optical International has received irrevocable undertaking from Ability Enterprise (BVI) Co., Ltd. in respect of 143.82 million shares representing 17.62% stake in Yorkey Optical International (Cayman) Ltd. An independent Board committee comprising the independent non-executive Directors, namely Lin Meng-Tsung, Lin Yi-Min and Liu Wei-Li has been established by the Board of Yorkey Optical International (Cayman) Ltd. to make a recommendation to the independent shareholders as to whether the terms of the proposal and the scheme are, or are not, fair and reasonable. After the transaction, the shares of Yorkey Optical International (Cayman) Ltd. will be delisted from The Stock Exchange of Hong Kong Limited and Taiwan depositary receipts will also be delisted from the Taiwan Stock Exchange upon or after the delisting of all the shares from The Stock Exchange of Hong Kong Limited. The scheme document shall be dispatched on or before November 5, 2021. As additional time is required to procure the holding of the Directions hearing and to finalize the financial information to be included in the scheme document, an application will be made with the Executive for its consent to extend the latest time for the dispatch of the scheme document. As on November 5, 2021, despatch of the Scheme Document changed from November 5, 2021 to January 25, 2022. The Executive has granted its consent on November 12, 2021 to extend the latest time for the despatch of the Scheme Document to January 25, 2022. As on December 20, 2021, Approval was received from The Investment Commission of The Ministry of Economic Affairs of Taiwan (“MOEAIC”).

As on January 4, 2022, The offer price was revised to HKD 0.999 per share. The Revised Cancellation Price will not be further increased, and the Offeror does not reserve the right to do so. The Additional Undertaking Shareholders hold 49,588,000 Shares in aggregate, representing approximately 6.07% of the issued share capital of the Company and approximately 8.41% of the Scheme Shares, respectively. The Offeror intends to finance the cash required for the cancellation and extinguishment of the Scheme Shares through the financing facility made available to the Offeror by a licensed bank in Hong Kong. In light of the Improved Proposal, AOCI is required to apply to the MOEAIC for the increase in the relevant investment amount by AOCI given the Revised Cancellation Price. The long stop date for the transaction is April 13, 2022. DL Securities (HK) Limited and VBG Capital Limited acted as the joint financial advisors to Asia Optical International Ltd. Halcyon Capital Limited acted as the independent financial advisor to the independent Board Committee of Yorkey Optical International (Cayman).