XD Inc. (2400.HK) is pleased to announce that a total of 347,234 options were granted to over 200 employees on July 12th  2021 under the company’s option plan, following a majority vote in favor of the Plan at the General Meeting.

In the details of the first batch of option grants, the two founders of the company, Huang Yimeng and Dai Yunjie, were granted 16,049 and 9,924 options respectively.

The XD Inc. Supplemental Option Plan (hereinafter referred to as XDSOP), is an optional option plan offered by the Company to all employees. In January of this year, the company provided employees with a draft of the XDSOP. After internal communication, refinement and presentation, an announcement was made on April 30, proposing the approval of the plan at the annual general meeting on June 25th 2021.

The XDSOP was officially implemented at the shareholders’ meeting with 95.18% of the shareholders’ affirmative votes. Subsequently, the company will grant options to employees participating in the option plan according to the terms of the option plan and in accordance with the established cycle.

The options are valid for 10 years without a lock-up period and may be exercised at any effective time after the grant of the options, and termination of employment will not lapse the options.

The XDSOP was developed with the long-term value proposition of the Company and the interests of employees as well as shareholders in mind. Therefore, the option plan features two main attributes.

– There is a cost to participate in XDSOP. The Company believes that an option plan that is worthwhile in the long term, with a high level of compensation already in place, is not the same as an incentive plan, but rather a financial arrangement that employees are free to choose within their salary package. Referring to option plans from companies like Netflix, the XDSOP sets the option acquisition cost at 40% of the exercise price.

– Voluntary participation. Each employee is eligible to participate in the XDSOP, and each employee is free to choose whether or not to participate in the XDSOP based on their own risk tolerance and cash flow planning, while fully understanding the risks, potential benefits and implementation details of the XDSOP, and there will be four annual participation windows. In consideration of the possibility of employees leaving the Company and withdrawing from the plan for any reason, XDSOP has made arrangements in the interest of employees: leaving the Company does not affect the effectiveness of the options, and employees can apply to withdraw from the plan at any time after one year of participation.

As an option plan with a relatively complex mechanism, it is quite important that XDSOP has the support of the relevant participants. Therefore, the Company is sincerely grateful for both the approval of the plan by a large percentage of votes at the General Meeting of shareholders and the fact that the plan received more than 10% of the total number of employee participants from the very beginning of its launch.

Just as the original intention of XDSOP, the company always takes ‘long-term value’ as the benchmark to judge whether the business and culture are in the interest of the Company, and grows together with players, employees and shareholders.