Administrative measures for the fifth phase of employee stock ownership plan
January, 2002
Chapter I General Provisions
Article 1 in order to standardize the implementation of the fifth employee stock ownership plan (hereinafter referred to as the “Employee Stock Ownership Plan” or “Employee Stock Ownership Plan”) of Anhui Korrun Co.Ltd(300577) (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 guiding opinions on the pilot implementation of employee stock ownership plan by listed companies (hereinafter referred to as the “guiding opinions”) Self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 2 – standardized operation of companies listed on GEM (hereinafter referred to as “self regulatory guidelines”), notice on issues related to opening accounts of employee stock ownership plans of listed companies of China Securities Depository and Clearing Co., Ltd., and other laws, regulations and rules These measures are formulated in accordance with the normative documents and the provisions of the articles of association of Anhui Korrun Co.Ltd(300577) (hereinafter referred to as the “articles of association”) and the fifth employee stock ownership plan (Draft) (hereinafter referred to as the “draft employee stock ownership plan”).
Article 2 from the effective date, these Measures shall become a legally effective document regulating the organizational procedures of this ESOP and the rights and obligations of employees participating in this ESOP, and shall be legally binding on any or all employees participating in this ESOP.
Chapter II Formulation of employee stock ownership plan, participants, capital source and stock source
Article 3 the basic principles of Employee Stock Ownership Plan:
(I) principle of legal compliance
The company implements the employee stock ownership plan, performs the procedures in strict accordance with the provisions of laws and administrative regulations, and makes information disclosure truthfully, accurately, completely and timely. No one shall use the employee stock ownership plan to engage in securities fraud such as insider trading and manipulation of the securities market.
(II) principle of voluntary participation
The implementation of the employee stock ownership plan by the company follows the principle of independent decision and voluntary participation of employees. The company does not force employees to participate in the employee stock ownership plan by means of apportionment, forced distribution, etc.
(III) risk bearing principle
The participants of the employee stock ownership plan are responsible for their own profits and losses, bear their own risks, and have equal rights and interests with other investors. Article 4 it shall be determined in accordance with the company law, securities law, guiding opinions, self regulatory guidelines and other relevant laws, regulations, normative documents and the articles of association. All participants are required to work in the company or its subsidiaries, receive remuneration and sign labor contracts.
Article 5 the participants of the employee stock ownership plan shall meet one of the following standards:
(I) business and technical backbones who work in key positions and contribute to the company’s business performance and development; (II) potential excellent employees and key training objects;
(III) old employees with certain historical contributions.
Article 6 after the ESOP is deliberated and approved by the general meeting of shareholders, the shares repurchased by the company shall be transferred, obtained and held at zero price through non transaction transfer and other ways permitted by laws and regulations, without the contribution of the participants. Article 7 the total amount of shares of the company corresponding to the shares of the employee stock ownership plan held by a single employee shall not exceed 1% of the total share capital of the company.
The total number of shares corresponding to the employee stock ownership plan does not include the shares obtained by employees before the listing of the company’s initial public offering, the shares purchased by themselves through the secondary market and the shares obtained through equity incentive.
Article 8 within 6 months after the general meeting of shareholders approves the employee stock ownership plan, the management committee will obtain the company’s shares by means of non trading transfer and other laws and regulations in accordance with the instructions of the employee stock ownership plan.
Article 9 the duration of the employee stock ownership plan is 18 months, counting from the date when the general meeting of shareholders deliberates and approves the employee stock ownership plan and announces the last transfer of the subject stock to the name of the employee stock ownership plan.
One month before the expiration of the duration of the ESOP, the duration of the ESOP can be extended after more than 2 / 3 of the shares held by the holders attending the shareholders’ meeting are agreed and submitted to the board of directors for deliberation and approval. After the lock-in period of the employee stock ownership plan expires, the employee stock ownership plan can transfer the shares to the individual name of the employee in a manner consistent with the laws and regulations at that time, or can choose to sell the shares to the outside world and distribute the income according to the proportion of shares held by the holders at that time. When the assets of the employee stock ownership plan are monetary funds, Or on the premise of the system support of Shenzhen Stock Exchange and registration and Clearing Company at that time, after the shares are transferred to the account of the plan holder, the employee stock ownership plan can be terminated in advance.
If there is no effective extension after the expiration of the duration of the employee stock ownership plan, the employee stock ownership plan shall be terminated automatically. Article 10 the lock up period of the shares purchased by the employee stock ownership plan is 12 months, which is calculated from the date when the company announces that the last underlying shares are registered in the name of the employee stock ownership plan.
The employee stock ownership plan will strictly abide by the market trading rules and the regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange on not buying and selling stocks in the information sensitive period.
Article 11 during the duration of the employee stock ownership plan, unless otherwise provided by laws, administrative regulations and departmental rules, or approved by the holder’s meeting, the holder shall not apply for withdrawal from the plan, and the shares of the employee stock ownership plan held by the holder shall not be transferred or used for mortgage, pledge, guarantee, debt repayment, etc.
During the lock-in period, when the company converts capital reserve into share capital and distributes stock dividends, the newly acquired shares of the employee stock ownership plan due to holding the company’s shares shall be locked together and shall not be sold in the secondary market or transferred in other ways. The lock-in period of these shares is the same as that of the corresponding shares.
Chapter III Rights and obligations of holders
Article 12 rights and obligations of the holder
(I) rights of holders
(1) Enjoy the equity of ESOP assets according to the shares of ESOP and the provisions of this ESOP (Draft);
(2) Participate in the shareholders’ meeting in accordance with the provisions of the plan and exercise the right to vote on the matters under consideration;
(3) Supervise the management of the employee stock ownership plan and put forward suggestions or questions;
(4) Other rights of the holder under relevant laws, regulations or the plan.
(II) obligations of the holder
(1) Comply with relevant laws, regulations and the provisions of the employee stock ownership plan (Draft);
(2) Bear the risk of ESOP investment according to the share of ESOP held;
(3) Comply with the resolutions of the shareholders’ meeting in force;
(4) Undertake other obligations of the holder under relevant laws, regulations or the plan.
Chapter IV Management of employee stock ownership plan
Article 13 the employee stock ownership plan is managed by the company itself, and the internal management authority is the holder meeting; A management committee shall be set up for the ESOP, which shall be elected by the employees participating in the ESOP through the holders’ meeting to supervise the daily management of the ESOP and exercise shareholders’ rights on behalf of the holders; The board of directors of the company is responsible for drafting and revising the draft plan and handling other relevant matters of the current employee stock ownership plan within the scope authorized by the general meeting of shareholders.
The management committee manages the assets of the employee stock ownership plan in accordance with relevant laws, administrative regulations, departmental rules, employee stock ownership plan (Draft) and these management measures, and maintains the legitimate rights and interests of the holders of the employee stock ownership plan to ensure the asset safety of the employee stock ownership plan.
The management committee manages the assets of the plan according to the written power of attorney of the shareholders’ meeting of the employee stock ownership plan. The management period is from the date when the employee stock ownership plan is considered and approved by the shareholders’ meeting to the date when all the shares held by the employee stock ownership plan are transferred or sold, the asset distribution is completed and the cancellation of the plan is completed.
Article 14 the shareholders’ meeting is the highest authority of the employee stock ownership plan, which is composed of all shareholders. All holders have the right to attend the meeting of ESOP holders and exercise their voting rights according to their shares. The holder may attend and vote at the holders’ meeting in person or entrust an agent to attend and vote on his behalf. The travel expenses, board and lodging expenses, etc. of the holder and its agent attending the meeting of the holder shall be borne by the holder. The shareholders’ meeting shall exercise the following functions and powers:
(1) Election and recall management committee;
(2) Review and approve the change, termination, extension and early termination of the employee stock ownership plan;
(3) Review whether the ESOP will participate in the company’s share allotment, additional issuance, convertible bonds and other financing and capital solutions during the duration;
(4) Authorize the management committee to decide and handle the acquisition of the underlying shares of the employee stock ownership plan;
(5) Authorize the management committee to decide and handle the transfer or sale of the underlying shares of the employee stock ownership plan; (6) Authorize the management committee to supervise the daily management of the employee stock ownership plan;
(7) Authorize the management committee to exercise the shareholders’ rights corresponding to the assets of the employee stock ownership plan;
(8) Authorize the management committee to exercise the asset management responsibilities of the employee stock ownership plan;
(9) Authorize the management committee to decide to redistribute or otherwise deal with the non vested shares to the holders who have made outstanding contributions to the company in the assessment year;
(10) Revise the measures for the administration of stock ownership plans;
(11) Other matters that the Management Committee deems necessary to convene a shareholders’ meeting for deliberation;
(12) Other functions and powers of the shareholders’ meeting specified in laws, regulations, rules, normative documents or the fifth employee stock ownership plan (Draft).
Article 15 the first holder meeting shall be convened and presided over by the chairman of the company, the general manager or the chairman of the trade union, and the subsequent holder meeting shall be convened and presided over by the management committee and presided over by the chairman of the Management Committee; If the chairman of the management committee is unable to perform his duties, the management committee shall elect other members of the management committee to preside over the meeting. Article 16 when convening a shareholders’ meeting, the convener of the meeting shall send a notice of the meeting five days in advance. The notice of general meeting shall at least include the time, place and method of the meeting, the main matters to be considered at the meeting, contact person and contact information, and the date of sending the notice.
Article 17 the holders of the employee stock ownership plan have one vote for each share of the plan. Holders who individually or jointly hold more than 30% of the shares of the employee stock ownership plan may propose to convene a holders’ meeting.
Article 18 holders who individually or jointly hold more than 30% of the shares of the employee stock ownership plan may submit interim proposals to the holders’ meeting, which must be submitted to the management committee 3 working days before the holders’ meeting.
Article 19 the shareholders’ meeting can be held only when the holders holding more than half of the shares are present.
Article 20 the shareholders’ meeting shall vote on all proposals one by one; Upon the decision of the moderator, the meeting may be held and voted by means of communication; The chairman shall specify in the notice of the meeting that the holders’ meeting adopts communication, the way of meeting and voting, and the way of sending voting opinions.
Article 21 the holder shall express one of the following opinions on the matters submitted to the holder’s meeting for consideration: consent, objection or waiver. Votes that are not filled in, wrongly filled in, illegible or not cast shall be deemed to have waived the voting right, and the voting result of the number of shares held shall be counted as “abstention”. If the holder votes after the chairman of the meeting announces the voting results or after the specified time limit for voting expires, the voting situation shall not be counted. Article 22 Unless otherwise specified, each resolution shall be adopted by more than half of the voting rights held by the holders attending the shareholders’ meeting. The change of the employee stock ownership plan shall be approved by more than 2 / 3 of the voting rights held by the holders attending the shareholders’ meeting and submitted to the board of directors of the company for deliberation and approval.
Article 23 the holders’ meeting shall elect two holders to be responsible for counting and supervising votes. The chairman of the shareholders’ meeting shall announce the voting results on the spot. The chairman of the meeting is responsible for arranging personnel to make minutes of the meeting.
Article 24 If the resolution of the shareholders’ meeting needs to be submitted to the board of directors and the general meeting of shareholders for deliberation, it must be submitted to the board of directors and the general meeting of shareholders for deliberation in accordance with the provisions of the articles of association.
Article 25 the management committee is elected by the shareholders’ meeting of the employee stock ownership plan. According to the provisions of the employee stock ownership plan, the management committee performs the daily management responsibilities of the employee stock ownership plan and exercises shares on behalf of the employee stock ownership plan. It has the following loyal obligations to the employee stock ownership plan:
(1) It shall not take advantage of its authority to accept bribes or other illegal income, and shall not encroach on the property of the employee stock ownership plan;
(2) Do not misappropriate ESOP funds;
(3) Without the consent of the holders’ meeting, the assets or funds of the employee stock ownership plan shall not be deposited in their own name or in the name of other individuals;
(4) Without the consent of the holders’ meeting, it is not allowed to lend the funds of the employee stock ownership plan to others or provide guarantee for others with the property of the employee stock ownership plan;
(5) It shall not use its authority to damage the interests of the employee stock ownership plan. If a member of the management committee violates his duty of loyalty and causes losses to the employee stock ownership plan, he shall be liable for compensation.
Article 27 functions and powers of the management committee
The management committee shall abide by laws, regulations, rules and the draft employee stock ownership plan and exercise the following functions and powers:
(1) Be responsible for convening the shareholders’ meeting;
(2) Supervise the daily management of the employee stock ownership plan on behalf of all holders;
(3) Exercise shareholders’ rights corresponding to the assets of the employee stock ownership plan on behalf of all holders and the employee stock ownership plan;
(4) Be responsible for liquidating the plan assets when the ESOP terminates;
(5) Sign relevant agreements and contracts on behalf of the ESOP;
(6) Decide and handle the acquisition of the underlying shares under the employee stock ownership plan;
(7) Decide and handle the transfer or sale of the underlying shares of the employee stock ownership plan;
(8) Decide and handle the distribution of principal and income of employee stock ownership plan;
(9) Handle the share registration of the employee stock ownership plan;
(10) Transfer shares or distribute income to holders on behalf of all holders and the employee stock ownership plan; (11) Decide to redistribute the non vested shares to the holders who have made outstanding contributions to the company within the assessment year or make other treatment;
(12) Other duties conferred by the shareholders’ meeting.
Article 28 Management Committee of employee stock ownership plan
