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Guangdong Huashang law firm
About Shenzhen Zhongzhuang Construction Group Co.Ltd(002822)
Repurchase and cancellation of some restricted shares in 2019
Legal opinion
January 2022
Guangdong Huashang law firm
About Shenzhen Zhongzhuang Construction Group Co.Ltd(002822)
Repurchase and cancellation of some restricted shares in 2019
Legal opinion
To: Shenzhen Zhongzhuang Construction Group Co.Ltd(002822)
Guangdong Huashang law firm (hereinafter referred to as “the firm”) has accepted the entrustment of Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) (hereinafter referred to as “the company” or ” Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) “) to act as special legal counsel for the company’s restricted stock incentive plan in 2019 (hereinafter referred to as “the incentive plan”) and has issued this legal opinion. This legal opinion is 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”) The measures for the administration of equity incentive of listed companies (hereinafter referred to as the “measures”) and other laws, regulations and normative documents issued by the China Securities Regulatory Commission (hereinafter referred to as the “CSRC”) and the Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) articles of Association (hereinafter referred to as the “articles of Association”) The Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) 2019 restricted stock incentive plan (Draft) (hereinafter referred to as the “incentive plan”) and other relevant provisions.
In order to issue this legal opinion, we hereby make the following statement:
As of the date of issuance of this legal opinion, none of the signing lawyers of this office holds shares in Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) , and there is no other relationship with Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) that may affect the fair performance of duties.
The firm and its handling lawyers express legal opinions in accordance with the provisions of the securities law, the measures for the administration of law firms engaging in securities legal business 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 issuance date of this legal opinion, as well as their understanding of the facts and the law. For the facts that are vital and cannot be supported by independent evidence, the exchange makes reasonable judgment by relying on the supporting documents issued by relevant government departments, companies or other relevant units. We have obtained the company’s written guarantee and commitment: the company has provided us with all the factual documents required to issue this legal opinion. All documents are true and complete without any falsehood, concealment, omission or misleading. The copies or copies of all documents are consistent with the original or original, and the seals and signatures on all documents are true.
This legal opinion only gives legal opinions on matters related to Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) repurchase and cancellation of some restricted shares in 2019 (hereinafter referred to as “matters related to this repurchase and cancellation”) according to law, and does not provide any form of guarantee for matters related to the implementation of 2019 restricted stock incentive plan.
This legal opinion only expresses opinions on the legality and compliance of Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) 2019 restricted stock repurchase and cancellation, and does not express opinions on the value of the underlying stock involved in the implementation of 2019 restricted stock incentive plan.
This legal opinion is only for the purpose of Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) 2019 restricted stock repurchase and cancellation, and shall not be used for any other purpose. The firm and its lawyers agree to take the legal opinions as the necessary legal documents for the company to implement the incentive plan, record or publicly disclose them together with other application materials, and bear corresponding legal liabilities for the legal opinions issued in accordance with the law.
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1、 Approval and authorization of this repurchase cancellation
(I) August 1, 2019, The 9th meeting of the 3rd board of directors of the company deliberated and approved the proposal on and its summary, the proposal on < Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) 2019 restricted stock incentive plan implementation assessment management measures, and the proposal on requesting the general meeting of shareholders to authorize the board of directors to handle matters related to the company's 2019 restricted stock incentive plan And other proposals related to this incentive plan. The independent directors of the company expressed their independent opinions on the scientificity and rationality of the incentive plan and its set indicators. On the same day, the ninth meeting of the third board of supervisors of the company considered and approved relevant proposals and verified the list of incentive objects. (II) August 19, 2019, The company's second extraordinary general meeting in 2019 deliberated and approved the proposal on and its summary, the proposal on < Shenzhen Zhongzhuang Construction Group Co.Ltd(002822) 2019 restricted stock incentive plan implementation assessment management measures, and the proposal on Authorizing the board of directors to handle matters related to the company's 2019 restricted stock incentive plan, The general meeting of shareholders approved the incentive plan and authorized the board of directors to handle matters related to the incentive plan.
(III) on September 6, 2019, the 11th meeting of the third board of directors of the company deliberated and approved the proposal on adjusting the list of restricted stock incentive objects of the company in 2019, the proposal on granting restricted shares to incentive objects of the company and other proposals related to this incentive plan. In view of the fact that the two incentive objects give up due to resignation or personal reasons, they no longer meet the grant conditions, The board of directors of the company adjusted the list, number and price of incentive objects of the incentive plan to: 6 million restricted shares will be granted to 57 incentive objects. The independent directors of the company have expressed their independent opinions on the above matters. On the same day, the 11th meeting of the third board of supervisors of the company deliberated and adopted relevant proposals and issued verification opinions on the list of incentive objects (Grant) of 2019 restricted stock incentive plan. On September 20, 2019, the restricted shares granted this time were listed on Shenzhen Stock Exchange. (IV) on April 27, 2020, the 19th meeting of the third board of directors of the company deliberated and approved the proposal on repurchase and cancellation of some restricted shares. In view of the resignation of six incentive objects for personal reasons and no longer qualified for incentive, the board of directors of the company decided to repurchase and cancel all or part of 125000 restricted shares granted to the above incentive objects but not lifted the sales restriction, The repurchase price is the sum of the grant price of RMB 3.7 per share plus the loan interest of the bank in the same period.
The independent directors of the company expressed their independent opinions on this proposal. On the same day, relevant proposals were considered and adopted at the 18th meeting of the third board of supervisors of the company. On July 7, 2020, the repurchase cancellation was completed in Shenzhen Branch of China Securities Depository and Clearing Co., Ltd.
(V) on September 3, 2020, the 24th Meeting of the third board of directors of the company deliberated and approved the proposal on repurchase and cancellation of some restricted shares and the proposal on achievement of the conditions for repurchase and cancellation of restricted shares in the first phase in 2019. In view of the fact that one incentive object is no longer qualified as an incentive object due to resignation and 16 incentive objects are “C” or “d” due to the assessment results in 2019, The board of directors of the company has decided to repurchase and cancel all or part of the restricted shares granted to the above incentive objects but not lifted, with a total of 239500 shares; The conditions for the release of restricted shares in the first release period of restricted shares in 2019 have been met, and the board of directors of the company has decided to handle the release of restricted shares in the first release period in accordance with the relevant provisions of the incentive plan; There are 50 incentive objects who meet the conditions for repurchase and cancellation, and the number of restricted shares that can apply for repurchase and cancellation is 1.635 million shares. The independent directors of the company expressed their independent opinions on this proposal. On the same day, relevant proposals were considered and adopted at the 21st Meeting of the third board of supervisors of the company. On November 24, 2020, the repurchase cancellation was completed in Shenzhen Branch of China Securities Depository and Clearing Co., Ltd.
(VI) on June 16, 2021, the second meeting of the Fourth Board of directors of the company deliberated and adopted the proposal on repurchase and cancellation of some restricted shares. In view of the resignation of 6 incentive objects for personal reasons, they are no longer eligible for incentive. The company plans to repurchase and cancel the restricted shares involved in the above reasons that have not been repurchased and cancelled. The company decided to repurchase and cancel 497000 restricted shares granted but not yet repurchased and cancelled.
(VII) on August 25, 2021, the fourth meeting of the Fourth Board of directors of the company deliberated and adopted the proposal on repurchase and cancellation of some restricted shares in 2019. The conditions for lifting the restrictions on the sale of restricted shares in 2019 have been achieved, The board of directors of the company decides to handle the lifting of restrictions on the sale of restricted shares in the second lifting period in accordance with the relevant provisions of the incentive plan; A total of 43 incentive objects met the conditions for repurchase and cancellation, and the number of restricted shares that can apply for repurchase and cancellation is 1443000 shares. The independent directors of the company expressed their independent opinions on this proposal. On the same day, the fourth meeting of the Fourth Board of supervisors of the company considered and adopted relevant proposals.
(VIII) on January 11, 2022, the ninth meeting of the Fourth Board of directors of the company deliberated and adopted the proposal on repurchase and cancellation of some restricted shares in 2019. The two incentive objects resigned for personal reasons, which did not meet the provisions on Incentive objects in the incentive plan of the company and no longer qualified for incentive; Due to the assessment results of “C” and “d” in 2020, according to the assessment management measures for the implementation of restricted stock incentive plan in 2019, part of the restricted shares of the above six persons cannot be unlocked in 2021. The company plans to use its own funds to repurchase and cancel 122500 restricted shares held by the above personnel that have been granted but have not been lifted. The repurchase price shall not be higher than the sum of the grant price and the deposit interest of the bank in the same period. The independent directors of the company expressed their independent opinions on this proposal. On the same day, the ninth meeting of the Fourth Board of supervisors of the company considered and adopted relevant proposals.
The proposals related to the repurchase cancellation need to be submitted to the second extraordinary general meeting of shareholders in 2022 for deliberation; The company still needs to fulfill the obligation of information disclosure in accordance with relevant laws and regulations, and go through the procedures related to the reduction of registered capital and the cancellation of share registration.
After verification, our lawyers believe that the company has obtained the necessary approval and authorization for the matters related to the repurchase cancellation at this stage, complies with the relevant provisions of the management measures, the incentive plan and the articles of association, and needs to be submitted to the general meeting of shareholders for deliberation.
2、 Details of this repurchase cancellation
(I) basis for cancellation of this repurchase
According to the provisions of the incentive plan, “if the incentive object’s contract expires and will not be renewed or leaves the company due to voluntary resignation or layoffs, the restricted shares granted to the incentive object under the incentive plan but not yet lifted shall not be lifted, and the company shall repurchase and cancel them at the sum of the grant price and the loan interest of the bank in the same period”, “On the premise that the company’s performance objectives are achieved, if the individual evaluation result of the incentive object in the previous year is a / B / C / D, the incentive object will lift the restriction on the sale of its granted restricted shares in accordance with the proportion specified in the plan;… The restricted shares that the incentive object cannot lift the restriction will be repurchased and cancelled by the company at the sum of the grant price and the loan interest of the bank in the same period”, After deliberation and approval at the 9th meeting of the 4th board of directors and the 9th meeting of the 4th board of supervisors, the aforesaid two incentive objects no longer have the qualification of incentive objects due to resignation, and the total number of restricted shares that should be repurchased and cancelled is 122500 shares.
(II) quantity of this repurchase cancellation
According to the announcement on the completion of the grant of restricted stock incentive plan in 2019, the number of restricted shares granted by the company for the first time in 2019 is 6 million shares. In April 2020, six incentive objects of the company resigned for personal reasons, and 125000 restricted shares granted but not unlocked have been repurchased and cancelled by the company; In September 2020 and June 2021, a total of 50 incentive objects who met the conditions for repurchase and cancellation in the first period of lifting the restrictions on sales, 1635000 restricted shares that can apply for repurchase and cancellation, and 239500 restricted shares that have been granted but not unlocked due to the resignation of one incentive object due to personal reasons have been repurchased and cancelled by the company; In June 2021, six incentive objects of the company resigned due to personal reasons, and 497000 restricted shares granted but not lifted have been repurchased and cancelled by the company; In August 2021, a total of 43 incentive objects met the conditions for repurchase and cancellation in the second release period. The number of restricted shares that can apply for repurchase and cancellation is 1443000 shares, which have been repurchased and cancelled by the company; The board of directors of the company decided to buy back and cancel 122500 shares of all or part of the restricted shares granted to the above-mentioned incentive objects but not lifted due to their resignation.
After the cancellation of this repurchase, the total share capital of the company will be reduced from 720541807 shares to 720419307 shares, and the registered capital will be reduced from 720541807 yuan to 720419307 yuan.
(III) price and capital source of this repurchase
According to the provisions of the incentive plan, if the company distributes cash dividends, bonus shares, conversion of provident fund into share capital, stock subdivision, stock reduction or allotment, which affect the amount of the company’s total share capital or the company’s stock price, the company shall adjust the repurchase price of the restricted shares that have not been unlocked accordingly. According to the announcement on the completion of the grant of the restricted stock incentive plan in 2019, the initial grant price of the company’s restricted stock in 2019 is 3.7 yuan / share; Due to the implementation of the annual equity distribution in 2020, the repurchase price shall not be higher than the sum of the grant price and the bank deposit interest in the same period. The number of shares repurchased this time is 122500, and the source of funds is the company’s own funds.
After verification, our lawyers believe that the reason, quantity and repurchase price of this repurchase cancellation
