Arctech Solar Holding Co.Ltd(688408)
Management measures for the implementation and assessment of restricted stock incentive plan in 2022
Arctech Solar Holding Co.Ltd(688408) (hereinafter referred to as “the company”) in order to further establish and improve the company’s long-term incentive and restraint mechanism, attract and retain talents, fully mobilize the enthusiasm of the company’s core team, effectively combine the interests of shareholders, the company and the personal interests of the core team, and enable all parties to jointly pay attention to and promote the long-term development of the company, On the premise of fully protecting the interests of shareholders and in accordance with the principle of equal incentives and constraints, the Arctech Solar Holding Co.Ltd(688408) 2022 restricted stock incentive plan (Draft) (hereinafter referred to as “incentive plan (Draft)” or “this incentive plan”) is formulated. In order to ensure the smooth implementation of the company’s incentive plan, these measures are hereby formulated in accordance with the company law of the people’s Republic of China, the securities law of the people’s Republic of China, the measures for the administration of equity incentive of listed companies, the Listing Rules of Shanghai Stock Exchange on the science and innovation board and other relevant laws, regulations, normative documents and the articles of association, and in combination with the actual situation of the company.
1、 Assessment purpose
In order to further improve the corporate governance structure of the company, promote the company to establish and improve the long-term incentive and restraint mechanism, fully mobilize the enthusiasm of the company’s core team, ensure the smooth implementation of the company’s incentive plan, give full play to the role of equity incentive to the greatest extent, and ensure the realization of the company’s development strategy and business objectives.
2、 Assessment principle
The assessment and evaluation must adhere to the principles of fairness, openness and fairness, and evaluate in strict accordance with the measures and the performance of the assessment object, so as to realize the close combination of the incentive plan with the work performance and contribution of the incentive object, so as to improve the level of performance management and maximize the interests of the company and all shareholders.
3、 Assessment scope
The measures are applicable to all incentive objects determined in the incentive plan, including directors, senior managers, core technicians and core management (Technology / business) backbones of the company (including branches and subsidiaries). The aforesaid incentive objects do not include the independent directors, supervisors, shareholders who individually or jointly hold more than 5% of the shares of the listed company, the actual controllers of the listed company and their spouses, parents, children and foreign employees. Among the aforesaid incentive objects, directors must be elected by the general meeting of shareholders of the company, and senior managers must be appointed by the board of directors of the company. All incentive objects must have employment or labor relations with the company (including branches and subsidiaries) when the company grants restricted shares and within the assessment period specified in the incentive plan.
4、 Assessment organization and responsibilities
（1） The remuneration and assessment committee of the board of directors of the company is responsible for leading and organizing the assessment work and reviewing the assessment results.
（2） Under the guidance of the remuneration and appraisal committee of the board of directors of the company, the human resources center is responsible for the specific appraisal implementation, and on this basis, the performance appraisal results are formed and submitted to the remuneration and appraisal committee of the board of directors of the company for review.
（3） Human resources center, internal audit department, financial management center, assessment units and other relevant departments are responsible for the collection and verification of personal performance assessment data, and are responsible for the authenticity and reliability of relevant data.
（4） The board of directors of the company is responsible for the examination and approval of these measures and the examination results.
5、 Assessment index
（1） Company level performance assessment requirements
The performance evaluation objectives of the restricted shares granted for the first time in the incentive plan are shown in the table below:
Corresponding operating income (a) or net profit (b)
Attribution period
Nuclear annual target value (am or BM) trigger value (an or BN)
The first operating income (AM) is not less than 5 billion yuan or the operating income (an) is not less than 3.5 billion yuan or 2022
The net profit (BM) in the vesting period shall not be less than 400 million yuan, and the net profit (BN) shall not be less than 300 million yuan
The second operating income (AM) is not less than 6 billion yuan or the operating income (an) is not less than 4.2 billion yuan or 2023
The net profit (BM) in the vesting period shall not be less than 550 million yuan, and the net profit (BN) shall not be less than 420 million yuan
The third operating income (AM) is not less than 7.5 billion yuan or the operating income (an) is not less than 5.25 billion yuan in 2024
The net profit (BM) in the vesting period shall not be less than 700 million yuan or the net profit (BN) shall not be less than 540 million yuan
If the reserved rights and interests of the incentive plan are granted in 2022, the corresponding assessment year is three fiscal years from 2022 to 2024, and the assessment is conducted once in each fiscal year. The achievement of the performance assessment goal is one of the conditions for the release of sales restriction / ownership of the incentive object in the current year. The performance assessment objectives of each year are shown in the table below:
Business income (a) or net profit (b) corresponding to the lifting of sales restriction / return
Trigger value of annual target value (am or BM) (an or BN)
The operating income (AM) of the first cancellation shall not be less than 5 billion yuan, and the operating income (an) shall not be less than 3.5 billion yuan in 2022
Sales restriction / vesting period or net profit (BM) not less than 400 million yuan or net profit (BN) not less than 300 million yuan
The operating income (AM) of the second cancellation shall not be less than 6 billion yuan, and the operating income (an) shall not be less than 4.2 billion yuan in 2023
Sales restriction / vesting period or net profit (BM) not less than 550 million yuan or net profit (BN) not less than 420 million yuan
The operating income (an) shall not be less than 5.25 billion yuan, and the operating income (AM) of the third termination shall not be less than 7.5 billion yuan
In 2024, the net profit (BN) is not less than 540 million yuan, the sales restriction / attribution period or the net profit (BM) is not less than 700 million yuan
element
If the reserved rights and interests of the incentive plan are granted in 2023, the assessment year of the corresponding company level is two fiscal years from 2023 to 2024. The performance assessment objectives of each year are as follows:
Business income (a) or net profit (b) corresponding to the lifting of sales restriction / return
Trigger value of annual target value (am or BM) (an or BN)
The operating income (AM) of the first cancellation shall not be less than 6 billion yuan, and the operating income (an) shall not be less than 4.2 billion yuan in 2023
Sales restriction / vesting period or net profit (BM) not less than 550 million yuan or net profit (BN) not less than 420 million yuan
Operating income of no less than RMB 5.5 billion (an) in the second month
In 2024, the net profit (BN) is not less than 540 million yuan, the sales restriction / attribution period or the net profit (BM) is not less than 700 million yuan
element
On the premise that the net profit of the company in each corresponding assessment year is not less than 200 million yuan, according to the above performance objectives, the proportion of lifting sales restrictions / ownership in each period is linked to the completion rate of assessment indicators in the assessment period. The specific linking methods are as follows:
Assessment indicators completion of assessment indicators company level lifting of sales restriction / ownership ratio x
A≥Am X1=100%
Operating income (a) an ≤ a < am X1 = 80% + (a-an) / (am an) * 20%
A<An X1=0%
B≥Bm X2=100%
Net profit (b) BN ≤ B < BM x2 = 80% + (b-bn) / (BM BN) * 20%
B<Bn X2=0%
It is determined that x is the higher of X1 and X2 at the company level
/Rules of attribution proportion x value
Note: 1. The above “operating income” indicators are calculated based on the value of operating income in the audited consolidated statements; 2. The above “net profit” index is based on the audited net profit attributable to the shareholders of the parent company, excluding the impact of all equity incentives and share based payment expenses involved in the employee stock ownership plan (if any) within the validity period of the company; 3. The above performance assessment objectives do not constitute the company’s performance prediction and substantive commitment to investors.
If the net profit of the corresponding assessment year of the company is less than 200 million yuan in each assessment period, or the net profit of the corresponding assessment year is not less than 200 million yuan, but the net profit and operating income of the assessment year do not reach the trigger value of performance assessment in the above table, All the restricted shares of the first category of the incentive object corresponding to the plan to lift the restriction in the current period shall be repurchased and cancelled by the company according to the sum of the grant price and the deposit interest of the people’s Bank of China in the same period; The class II restricted shares of all incentive objects corresponding to the current appraisal plan shall not be vested, invalid and shall not be deferred to the next period.
(II) performance appraisal requirements at the individual level of incentive objects
The individual level performance appraisal of the incentive object shall be implemented in accordance with the relevant internal performance appraisal system of the company. The performance appraisal results of incentive objects are divided into four grades: a “(excellent)”, “B (good)”, “C (qualified)” and “d (unqualified)”. At that time, the proportion of lifting the restriction / attribution at the current personal level will be confirmed according to the individual performance appraisal results of the previous year. The comparison relationship between individual performance appraisal results and the proportion of lifting sales restrictions / ownership at the individual level is shown in the table below:
Individual performance appraisal results a (excellent) B (good) C (qualified) d (unqualified)
At the individual level, the proportion of lifting restrictions on sales / ownership is 100%, 90%, 80% and 0%
On the premise that the company’s performance assessment objectives are achieved, the number of restricted shares that the incentive object actually removes the restriction / ownership in the current period = the number of restricted shares that the individual plans to remove the restriction / ownership in the current period × Proportion of sales restriction lifting / ownership at the company level × The proportion of lifting restrictions on sales / ownership at the individual level.
The part of the restricted shares of category I that the incentive object plans to lift the restrictions on sale in the current period that cannot be lifted due to assessment reasons shall be repurchased and cancelled by the company according to the sum of the grant price and the deposit interest of the people’s Bank of China in the same period; If the class II restricted shares that the incentive object plans to belong to in the current period cannot be attributed or cannot be fully attributed due to assessment reasons, they shall be invalid and shall not be deferred to the next period.
After the performance appraisal at the company level and individual level, the number of restricted shares that can actually be released / owned by individuals in the current year is rounded to an integer.
If the incentive objects are directors and senior managers of the company, such as the company’s issuance of shares (including preferred shares) or convertible bonds, which leads to the dilution of the company’s immediate return and the need to fulfill the measures to fill the immediate return, as the incentive objects of this incentive plan, the lifting of the restriction / ownership of the restricted shares obtained by individuals, in addition to meeting the above conditions for lifting the restriction / ownership, It also needs to meet the conditions for the effective implementation of the filling return measures formulated and implemented by the company. 6、 Assessment period and times
（1） Assessment period
The fiscal year prior to the release / attribution of restricted shares of each incentive object.
（2） Assessment times
The assessment year of the incentive plan is three fiscal years from 2022 to 2024, which is assessed once a year.
7、 Assessment procedure
Under the guidance of the remuneration and appraisal committee of the board of directors, the human resources center of the company is responsible for the specific appraisal work, saves the appraisal results, forms a performance appraisal report on this basis and submits it to the remuneration and appraisal committee of the board of directors.
8、 Assessment result management
（1） Feedback and appeal of assessment results
1. The examinee has the right to know his own assessment results, and the remuneration and assessment committee of the board of directors shall notify the examinee of the assessment results within five working days after the end of the assessment;
2. If the examinee has any objection to the assessment results, he can appeal to the remuneration and assessment committee of the board of directors within five working days after receiving the assessment notice. The remuneration and assessment committee can review the assessment results according to the actual situation and revise the assessment results according to the review results;
3. The assessment results shall be used as the basis for lifting the restriction on sale / ownership of restricted shares.
（2） Filing of assessment records
1. After the assessment, the assessment team shall keep all assessment records and files of performance assessment for examination
