Topsec Technologies Group Inc(002212)
“Striver” phase I stock option incentive plan
Implementation of assessment management measures
(March 2022)
Topsec Technologies Group Inc(002212) (hereinafter referred to as “the company”) in order to further improve the corporate governance structure, improve the incentive and restraint mechanism of the company, form a good and balanced value distribution system, fully mobilize the enthusiasm of the directors, senior managers, core managers of the company and its subsidiaries, and core business (technical) personnel of the company and its subsidiaries, so as to make them work more honestly and diligently, In order to ensure the steady improvement of the company’s performance and the realization of the company’s development strategy and business objectives, the company plans to implement the first phase of the “striver” stock option incentive plan (hereinafter referred to as the “equity incentive plan”).
In order to ensure the smooth implementation of the equity 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 and other relevant laws, regulations and normative documents, as well as the relevant provisions of the articles of association and the equity incentive plan of the company, and in combination with the actual situation of the company.
1、 Assessment purpose
Further improve the corporate governance structure, establish and improve the company’s incentive and restraint mechanism, ensure the smooth implementation of the company’s equity incentive plan, and give full play to the role of equity incentive to the greatest extent, so as to 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 the performance of the assessment objects in strict accordance with these measures, so as to realize the close combination of the equity incentive plan and the work performance and contribution of the incentive objects, so as to improve the overall performance of the company and maximize the interests of the company and all shareholders.
3、 Assessment scope
These measures are applicable to all incentive objects participating in the company’s equity incentive plan, mainly directors and senior managers of the company and its subsidiaries, core managers of the company and its subsidiaries, and core business (technical) personnel of the company and its subsidiaries.
4、 Assessment organization
The remuneration and assessment committee of the board of directors of the company is responsible for leading and organizing the assessment. Under the guidance of the remuneration and assessment committee, the company and its subsidiaries are responsible for assessing the directors, senior managers, core managers of the company and its subsidiaries, and core business (technical) personnel of the company and its subsidiaries.
5、 Assessment indicators and standards
(I) performance assessment requirements at the company level
1. The exercise assessment year of stock options granted for the first time in the incentive plan is three fiscal years from 2022 to 2024, which is assessed once in each fiscal year. The performance assessment objectives of each year and the exercise proportion at the company level are shown in the table below:
Based on the net profit in 2021 and the operating income in 2021
The exercise period corresponds to the annual net profit growth rate and the annual operating income growth rate of the assessment year
Target value target value
The first exercise period is 30% 20% in 2022
The second exercise period is 60% and 40% in 2023
The third exercise period is 2024, 100% 60%
Actual number of company performance assessment objectives completed
Exercise proportion at the company level
(based on net profit and operating income in 2021)
Annual net profit growth rate ≥ 100% of the target value
80% of target value ≤ annual net profit growth rate target value, and annual operating income
90%
Growth rate ≥ target value
80% of the target value ≤ annual net profit growth rate the target value, and 80% of the target value
80%
≤ annual revenue growth rate target value
80% of target value ≤ annual net profit growth rate target value, and annual operating income
70%
Growth rate 80% of the target value, annual net profit growth rate 80% of the target value, and annual operating revenue growth rate ≥
60%
The annual net profit growth rate of 100% of the target value 80% of the target value, and 80% of the target value ≤ annual operating income
50%
Business income growth rate target value, annual net profit growth rate 80% of target value, and annual operating income growth rate0%
80% of target value Description:
(1) The above target calculation of “net profit in 2021” and “annual net profit growth rate” is based on the net profit attributable to the shareholders of the listed company excluding the impact of share based payment expenses, that is, the calculation formula is: the net profit attributable to the shareholders of the listed company in the audited consolidated statements + the share based payment expenses amortized in the current year; The above share based payment expenses include the share based payment expenses arising from this and all other equity incentive plans and employee stock ownership plans within the validity / duration.
(2) The above target calculation of “operating revenue in 2021” and “annual operating revenue growth rate” refers to the operating revenue in the audited consolidated statements.
2. If the stock options reserved for grant in this equity incentive plan are granted before the disclosure of the report of the third quarter of 2022, the exercise assessment year of each period, the performance assessment objectives of each year and the exercise proportion at the company level are the same as those granted for the first time;
If the stock options reserved for grant are granted after the disclosure of the third quarter report of 2022, the assessment year will be three fiscal years from 2023 to 2025, and the assessment will be conducted once in each fiscal year. The performance assessment objectives of each year and the exercise proportion at the company level are shown in the following table:
Based on the net profit in 2021 and the operating income in 2021
The exercise period corresponds to the annual net profit growth rate and the annual operating income growth rate of the assessment year
Target value target value
The first exercise period is 202360% 40%
The second exercise period will be 100% 60% in 2024
The third exercise period is 150% and 80% in 2025
Actual number of company performance assessment objectives completed
Exercise proportion at the company level
(based on net profit and operating income in 2021)
Annual net profit growth rate ≥ 100% of the target value
80% of target value ≤ annual net profit growth rate target value, and annual operating income
90%
Growth rate ≥ 80% of the target value ≤ annual net profit growth rate the target value, and 80% of the target value
80%
≤ annual operating revenue growth rate 80% of the target value ≤ annual net profit growth rate the target value, and annual operating revenue
70%
Growth rate 80% of the target value, annual net profit growth rate 80% of the target value, and annual operating revenue growth rate ≥
60%
The annual net profit growth rate of 100% of the target value 80% of the target value, and 80% of the target value ≤ annual operating income
50%
Business income growth rate target value, annual net profit growth rate 80% of target value, and annual operating income growth rate0%
80% of target value Description:
(1) The above target calculation of “net profit in 2021” and “annual net profit growth rate” is based on the net profit attributable to the shareholders of the listed company excluding the impact of share based payment expenses, that is, the calculation formula is: the net profit attributable to the shareholders of the listed company in the audited consolidated statements + the share based payment expenses amortized in the current year; The above share based payment expenses include the share based payment expenses arising from this and all other equity incentive plans and employee stock ownership plans within the validity / duration.
(2) The above target calculation of “operating revenue in 2021” and “annual operating revenue growth rate” refers to the operating revenue in the audited consolidated statements.
If the company fails to meet the above performance assessment objectives, the stock options of all incentive objects corresponding to the exercisable rights in the assessment year shall not be exercised and shall be cancelled by the company.
(II) performance appraisal requirements at individual level
Under the guidance of the salary assessment committee, the company and its subsidiaries assess the incentive objects annually and determine their exercise proportion according to the assessment results. The actual exercise amount of the incentive object in the current year = the exercise proportion at the individual level × The individual’s planned exercise limit of the current year.
The performance evaluation results of incentive objects are divided into five grades: A, B, C, D and e. the evaluation form is applicable to the evaluation objects. At that time, the exercise proportion of incentive objects will be determined according to the following table:
Evaluation results a b c d e
Exercise proportion: 100%, 90%, 80%, 60%, 0%
If the individual performance appraisal of the incentive object in the previous year is rated as a, B, C and D, the individual performance appraisal of the incentive object in the previous year is “up to standard”, the incentive object can exercise the right according to the proportion specified in the equity incentive plan, and the part not exercised in the current period shall be cancelled by the company; If the individual performance appraisal result of the incentive object in the previous year is e, the individual performance appraisal of the incentive object in the previous year is “unqualified”, and the company will cancel the exercise amount of the incentive object in the current period in accordance with the provisions of the equity incentive plan, and the stock options that have not been exercised in the current period will be cancelled by the company.
(III) if the incentive objects are directors and senior managers of the company, and if they make a commitment to fulfill the measures to fill the immediate return due to the dilution of the immediate return caused by the major asset reorganization of the company, the stock option granted to them as the incentive objects of the incentive plan shall meet the conditions for the effective implementation of the measures to fill the immediate return formulated and implemented by the company in addition to the above four exercise conditions, If this condition is not met, the current exercise limit of the incentive object will be cancelled, and the stock option will be cancelled by the company.
6、 Assessment period and times
(I) assessment period
The fiscal year before the incentive object applies for stock option exercise.
(II) assessment times
The assessment year of stock options granted for the first time in this equity incentive plan is three fiscal years from 2022 to 2024; If the reserved stock options are granted before the disclosure of the third quarter report in 2022, the assessment year is 20222024. If the stock options are granted after the disclosure of the third quarter report in 2022, the assessment year is 20232025, and the assessment is conducted once a year.
7、 Exercise of power
(I) the remuneration and appraisal committee of the board of directors shall determine the exercise qualification and quantity of incentive objects according to the performance appraisal report.
(II) the performance appraisal results shall be used as the basis for the exercise of stock options.
8、 Assessment procedure
The company and its subsidiaries are responsible under the guidance of the remuneration and assessment committee of the board of directors
