Shanghai BoChang law firm
about
Pnc Process Systems Co.Ltd(603690)
Of the fourth stock option and restricted stock incentive plan (Draft)
Legal opinion
February, 2002
Shanghai Bo law firm
About
Pnc Process Systems Co.Ltd(603690)
The fourth stock option and restricted stock incentive plan (Draft)
of
Legal opinion
To: Pnc Process Systems Co.Ltd(603690)
According to the legal service entrustment agreement signed between Pnc Process Systems Co.Ltd(603690) (hereinafter referred to as ” Pnc Process Systems Co.Ltd(603690) ” and “the company”) and Shanghai BoChang law firm (hereinafter referred to as “the firm”), the firm accepts the entrustment of Pnc Process Systems Co.Ltd(603690) , in accordance with the company law of the people’s Republic of China (hereinafter referred to as “the company law”) and the securities law of the people’s Republic of China (hereinafter referred to as “the securities law”) In accordance with the provisions of the measures for the administration of equity incentive of listed companies (hereinafter referred to as the “measures”) and other relevant laws, regulations and normative documents, this legal opinion is issued on matters related to the fourth phase of Pnc Process Systems Co.Ltd(603690) stock option and restricted stock incentive plan (hereinafter referred to as the “incentive plan”).
(Introduction)
The firm is a law firm registered in accordance with the law and is qualified to issue legal opinions on the understanding and application of Chinese laws, regulations and normative documents.
In accordance with the provisions of the securities law, the measures for the administration of securities legal business of law firms and the rules for the practice of securities legal business of law firms (for Trial Implementation), as well as the facts that have occurred or exist before the date of issuance of this legal opinion, the firm and its handling lawyers have strictly performed their statutory duties and followed the principles of diligence and good faith, Sufficient verification and verification have been carried out to ensure that the facts identified in this legal opinion are true, accurate and complete, that the concluding opinions issued are legal and accurate, and that there are no false records, misleading statements or major omissions, and bear corresponding legal liabilities.
Our lawyers express legal opinions in accordance with the laws, regulations and normative documents in force in China up to the date of issuance of this legal opinion, as well as the understanding of the relevant facts involved in the Pnc Process Systems Co.Ltd(603690) fourth stock option and restricted stock incentive plan.
Pnc Process Systems Co.Ltd(603690) has assured the exchange that the documents and statements and explanations provided to the exchange are complete, true and effective, and all facts and documents sufficient to affect this legal opinion have been disclosed to the exchange without any concealment or omission.
The exchange declares that as of the date of issuance of this legal opinion, neither the exchange nor the signing lawyer holds Pnc Process Systems Co.Ltd(603690) shares, and there is no relationship with Pnc Process Systems Co.Ltd(603690) that may affect the fair performance of duties.
This legal opinion only expresses opinions on the legality and compliance of Pnc Process Systems Co.Ltd(603690) phase IV stock option and restricted stock incentive plan and relevant legal matters, and does not express opinions on the value of the underlying stock involved in Pnc Process Systems Co.Ltd(603690) this incentive plan.
This legal opinion is only used for the purpose of Pnc Process Systems Co.Ltd(603690) the fourth stock option and restricted stock incentive plan, and shall not be used for any other purpose without the prior written permission of the exchange.
The exchange agrees to take this legal opinion as one of the necessary legal documents of Pnc Process Systems Co.Ltd(603690) this incentive plan, report or publicly disclose it together with other application materials, and bear corresponding legal liabilities for the legal opinion issued in accordance with the law.
In accordance with the requirements of relevant laws and regulations and in accordance with the business standards, ethics and the spirit of diligence recognized by the Chinese lawyer industry, our lawyers have verified and verified the relevant facts involved in the fourth phase of Pnc Process Systems Co.Ltd(603690) stock option and restricted stock incentive plan, and issued this legal opinion.
(text)
1、 Pnc Process Systems Co.Ltd(603690) subject qualifications and conditions for the implementation of equity incentive plan
1. After verification by our lawyers, Pnc Process Systems Co.Ltd(603690) is a joint stock limited company established and validly existing on November 13, 2000. Approved by the reply on approving Pnc Process Systems Co.Ltd(603690) initial public offering of shares (zjxk [2016] No. 3058) of China Securities Regulatory Commission on December 9, 2016, Pnc Process Systems Co.Ltd(603690) issued 52 million RMB common shares (A shares) to the public for the first time, and was listed on Shanghai Stock Exchange on January 13, 2017. The stock is referred to as ” Pnc Process Systems Co.Ltd(603690) “, Stock code 603690.
2. After verification by our lawyers, Pnc Process Systems Co.Ltd(603690) now holds the business license with the unified social credit code of 9131000070304179xy issued by Shanghai Administration for Industry and commerce. Its domicile is No. 170, Zihai Road, Minhang District, Shanghai. Its legal representative is Jiang Yuan. Its registered capital is 318500474 yuan. Its type is stock limited company (listed, natural person investment or holding)), The business scope is “Engaged in technology development, technology transfer, technical consultation and technical services in the professional fields of electronics, optical fiber, bioengineering and environmental protection technology, design and installation of water treatment system and clean room workshop, technical consulting services, sales of electromechanical products, communication equipment and related products, instruments, computers and accessories, building materials and stainless steel products, and installation of electromechanical equipment (except for special control), production, design and processing of mechanical equipment (limited to building 2, No. 170, Zihai Road), import and export business of goods and technology, quality inspection technical services, repair of measuring instruments, technical consultation, technical service, technology development and technology transfer in the professional field of measurement and calibration science and technology, and wholesale and retail of measuring instruments and meters. [for projects subject to approval according to law, business activities can be carried out only with the approval of relevant departments] “. The operation period is from November 13, 2000 to long-term.
According to the verification of our lawyers, as of the date of issuance of this legal opinion, Pnc Process Systems Co.Ltd(603690) has effectively existed, and there is no need to terminate according to the provisions of the company law and other laws, regulations, normative documents or the articles of association of Pnc Process Systems Co.Ltd(603690) (hereinafter referred to as the “articles of association”).
3. According to the 2020 annual report announced by Pnc Process Systems Co.Ltd(603690) and the standard unqualified audit report (Zhong Hui Zi (2021) No. 05138), 2020 profit distribution plan, articles of association and other documents issued by Zhonghua Certified Public Accountants (special general partnership), Pnc Process Systems Co.Ltd(603690) does not have the following circumstances that equity incentive shall not be implemented as stipulated in Article 7 of the management measures:
(1) The financial and accounting report of the most recent fiscal year is an audit report with a negative opinion or unable to express an opinion issued by a certified public accountant;
(2) The internal control of the financial report of the most recent fiscal year is an audit report with a negative opinion or unable to express an opinion issued by a certified public accountant;
(3) Failure to distribute profits in accordance with laws and regulations, articles of association and public commitments within the last 36 months after listing;
(4) Equity incentive is not allowed according to laws and regulations;
(5) Other circumstances recognized by the CSRC.
In conclusion, our lawyers believe that: Pnc Process Systems Co.Ltd(603690) is a joint stock limited company established and validly existing according to law; As of the issuance date of this legal opinion, Pnc Process Systems Co.Ltd(603690) has not been terminated in accordance with laws and regulations and the articles of association, and there is no situation that equity incentive shall not be implemented in accordance with the management measures; Pnc Process Systems Co.Ltd(603690) have the subject qualification and conditions to implement the equity incentive plan.
2、 Main contents of this incentive plan
On February 7, 2022, the 15th meeting of the Fourth Board of directors deliberated and adopted the proposal on and its summary. According to the Pnc Process Systems Co.Ltd(603690) fourth stock option and restricted stock incentive plan (Draft) (hereinafter referred to as the “incentive plan (Draft)”), this incentive plan adopts the form of stock option and restricted stock. The incentive plan (Draft) mainly includes “interpretation”, “purpose of the incentive plan”, “management organization of the incentive plan”, “determination basis and scope of incentive objects”, “specific contents of the incentive plan”, “implementation procedures of the incentive plan”, “respective rights and obligations of the company and incentive objects”, “handling of abnormal conditions between the company and incentive objects” “Supplementary Provisions” and other nine chapters.
After verification by our lawyers, the incentive plan (Draft) has included the following contents:
(I) purpose of equity incentive;
(III) the number of rights and interests to be granted, the type, source and number of underlying shares involved in the rights and interests to be granted, and the percentage in the total share capital of the listed company; The number of rights and interests to be reserved, the number of underlying shares involved and the percentage in the total amount of underlying shares of the equity incentive plan;
(IV) if the incentive objects are directors and senior managers, the number of rights and interests they can be granted and their percentage in the total amount of rights and interests to be granted under the equity incentive plan; The number of rights and interests that can be granted to other incentive objects and their percentage in the total amount of rights and interests to be granted under the equity incentive plan;
(V) the validity period of the equity incentive plan, the grant date, restricted sale period and exercise / release of restricted shares;
(VI) the grant price of stock options / restricted stocks or the determination method of the grant price;
(VII) conditions for granting rights and interests to incentive objects and exercising rights and interests;
(VIII) procedures for the granting of rights and interests by listed companies and the exercise of rights and interests by incentive objects;
(IX) methods and procedures for adjusting the number of rights and interests, the number of underlying shares and the grant price;
(x) accounting treatment method of equity incentive, determination method of fair value of stock option / restricted stock, rationality of important parameters involved in valuation model, accrued expenses for the implementation of equity incentive and its impact on the operating performance of listed companies;
（11） Change and termination of equity incentive plan;
（12） The implementation of the equity incentive plan in case of change of control, merger, division of the listed company and change of position, resignation and death of the incentive object;
（13） Relevant disputes or dispute settlement mechanism between listed companies and incentive objects;
（14） Other rights and obligations of listed companies and incentive objects.
The relevant contents of the incentive plan of the listed company (the draft of the incentive plan of the listed company) approved by the board of directors shall be clearly in line with the provisions of article 690 of the incentive plan of the listed company. 3、 Legal procedures involved in this incentive plan
(I) procedures performed in this incentive plan
After verification by our lawyers, as of the issuance date of this legal opinion, Pnc Process Systems Co.Ltd(603690) has fulfilled the following procedures for the formulation, deliberation and publicity of this incentive plan:
1. The remuneration and assessment committee under the board of directors of the company formulated the incentive plan (Draft) and submitted it to the board of directors for deliberation.
2. On February 7, 2022, Pnc Process Systems Co.Ltd(603690) the 15th meeting of the Fourth Board of directors deliberated and adopted the incentive plan (Draft) and the proposals related to the incentive plan.
3. On February 7, 2022, Pnc Process Systems Co.Ltd(603690) the 14th meeting of the Fourth Board of supervisors deliberated and adopted the incentive plan (Draft) and its summary, and expressed opinions on the incentive plan, believing that the fourth stock option and restricted stock incentive plan (Draft) and its summary of the company comply with the company law, the securities law According to the provisions of the measures for the administration of equity incentive of listed companies and other relevant laws, regulations and normative documents, the implementation of the company’s equity incentive plan is conducive to further improving the company’s governance structure, promoting the company to establish and improve the long-term incentive mechanism and restraint mechanism, and enhancing the sense of responsibility and mission of the company’s management team and core backbone to realize the sustainable and healthy development of the company, Effectively combine the interests of shareholders, the company and core employees to ensure the realization of the company’s development objectives without damaging the interests of the company and all shareholders.
4. Pnc Process Systems Co.Ltd(603690) the independent directors expressed their independent opinions and held that: (1) the company does not have the situation that the implementation of equity incentive plan is prohibited by laws, regulations and normative documents such as the measures for the administration of stock incentive of listed companies, and the company has the subject qualification to implement equity incentive plan. (2) The incentive objects of the incentive plan (Draft) comply with the provisions of the company law, the securities law, the measures for the administration of equity incentive of listed companies and other laws, regulations and normative documents, as well as the provisions on the subject qualification in the articles of association. The subject qualification of the incentive objects is legal and effective. (3) The formulation, deliberation procedures and contents of the incentive plan (Draft) and its summary comply with the provisions of relevant laws, regulations and normative documents such as the company law, the securities law, the measures for the administration of stock incentive of listed companies and so on; The granting arrangements, exercise / lifting of restrictions on the sale of stock options and restricted shares granted to each incentive object comply with the provisions of relevant laws, regulations and normative documents, and there is no situation that damages the legitimate rights and interests of the company and all shareholders. (4) The company has no plans or arrangements to provide loans, loan guarantees and other forms of financial assistance for the incentive objects to obtain relevant rights and interests according to the incentive plan. (5) The company’s implementation of equity incentive plan is conducive to further optimizing the company’s governance structure, establishing and improving the company’s long-term incentive and restraint mechanism, improving the company’s salary assessment system, improving the company’s overall cohesion, fully mobilizing the initiative and creativity of the company’s operation and management team and core cadres, and ensuring the realization of the company’s future development strategy and business objectives, Bring more efficient and lasting returns to shareholders.
(II) follow up procedures to be performed in this incentive plan
After verification by our lawyers, Pnc Process Systems Co.Ltd(603690) will also perform the follow-up review, publicity and other procedures of the incentive plan as follows:
1. The company will publicize the names and positions of incentive objects within the company before the general meeting of shareholders, and the publicity period shall not be less than 10 days. The board of supervisors shall review the list of incentive objects and fully listen to the public opinions. The company shall disclose the explanation of the board of supervisors on the review and publicity of the list of incentive objects five days before the shareholders’ meeting deliberates the incentive plan.
2. The company will conduct a self-examination on the trading of the company’s shares and their derivatives by insiders within 6 months before the announcement of the draft incentive plan to explain whether there is insider trading. Those who buy and sell the company’s shares after knowing the inside information shall not become incentive objects, except for the circumstances that do not belong to insider trading according to laws, administrative regulations and relevant judicial interpretations. The disclosure of inside information leads to insider trading
