News Center
Enterprises are public instruments of society.
News Center
Document No. 1 for the Shareholders’ Meeting – Restricted Stock Incentive Plan (Draft)
Document No. 1 of the First Extraordinary General Meeting of Shareholders in 2015
Dalian Refrigeration Co., Ltd.
Restricted Stock Incentive Plan
(Draft)
Dalian Refrigeration Co., Ltd.
February 2015
Statement
The Company, together with all directors and supervisors, hereby warrants that this Incentive Plan and its summary contain no false records, misleading statements, or material omissions, and undertakes individual and joint legal liability for their truthfulness, accuracy, and completeness.
Special Note
I. This Incentive Plan is 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 Administrative Measures for Equity Incentives of Listed Companies (Trial), Memoranda No. 1–3 on Matters Related to Equity Incentives, and other relevant laws, regulations, and normative documents, as well as the Articles of Association of Dalian Refrigeration Co., Ltd.
II. The incentive instrument adopted under this Incentive Plan is restricted stock. The shares will be sourced from the Company’s targeted issuance of A-share common stock of Dalian Refrigeration Co., Ltd. (hereinafter referred to as the “Company” or “this Company”) to the eligible recipients.
III. The proposed number of restricted shares to be granted under this incentive plan is 10.15 million, representing 2.900% of the Company’s total share capital of 350.014975 million shares as of the date of the announcement of the draft of this incentive plan and its summary.
IV. The recipients of awards under this Incentive Plan shall include the Company’s directors, mid- and senior-level management personnel, and other core personnel whom the Board of Directors deems should be incentivized and who are employed by the Company (including its subsidiaries) at the time this Incentive Plan is announced. The Plan shall not apply to supervisors, independent directors, foreign directors, or foreign management personnel. Furthermore, no recipient under this Incentive Plan shall concurrently participate in equity incentive plans of two or more listed companies, and no major shareholder holding 5% or more of the Company’s shares, nor the actual controller of the Company, nor their spouses or direct relatives, shall participate in this Incentive Plan. The recipients must also comply with the provisions of Article 7 of Memorandum No. 1 on Matters Relating to Equity Incentives, Article 1 of Memorandum No. 2 on Matters Relating to Equity Incentives, and Article 8 of the Provisional Measures for the Administration of Equity Incentives for Listed Companies.
V. From the date of the announcement of this Incentive Plan until the date on which the eligible recipients complete the registration of the restricted shares, if the Company undertakes any of the following actions—capitalization of capital reserves into share capital, distribution of stock dividends, stock split or reverse stock split, rights issue, or dividend distribution—the grant price or the number of restricted shares to be granted shall be adjusted accordingly in accordance with this Incentive Plan.
VI. The term of this Incentive Plan shall commence on the date of the grant of the restricted shares and expire on the date when all the restricted shares granted to the incentive recipients have been fully vested or repurchased and cancelled, with a maximum duration of four years.
VII. A 12-month lock-up period shall commence on the date on which the incentive recipients are granted restricted shares. During the lock-up period, the restricted shares granted under this Incentive Plan (including any stock dividends derived therefrom, the same shall apply hereinafter) shall be subject to a lock-up and may not be transferred or used to repay debts. Upon expiration of the lock-up period, an unlock period shall begin. Starting from the date of grant, the restricted shares awarded under this Incentive Plan shall be subject to three tranches of unlocking over the subsequent 36 months, with the first tranche becoming available one year after the end of the lock-up period; the second tranche becoming available two years after the end of the lock-up period; and the third tranche becoming available three years after the end of the lock-up period. During each unlock period, provided that the unlock conditions set forth in this Incentive Plan are met, the incentive recipients may apply for the unlocking of their respective portions: 30% of the total number of restricted shares granted in the first unlock period; 40% in the second unlock period; and 30% in the third unlock period.
VIII. The Company does not fall under any of the circumstances specified in Article 7 of the Provisional Measures for Equity Incentive Management of Listed Companies that would prohibit the implementation of an equity incentive plan:
1. The financial statements for the most recent fiscal year have been issued an adverse opinion or a disclaimer of opinion by the certified public accountant.
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past year;
3. Other circumstances as determined by the China Securities Regulatory Commission.
9. The recipients of this incentive plan do not fall under any of the circumstances specified in Article 8 of the Provisional Measures for Equity Incentive Management of Listed Companies that would disqualify them from being eligible for such incentives:
1. Having been publicly censured by a stock exchange or designated as an unsuitable person within the past three years;
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past three years;
3. Falling under any of the circumstances stipulated in the Company Law of the People’s Republic of China that disqualify one from serving as a director, supervisor, or senior management personnel of a company.
X. The Company undertakes not to provide any loans or other forms of financial assistance, including guarantees for loans, to the incentive recipients in connection with their acquisition of restricted shares under this Incentive Plan.
11. This Incentive Plan shall be implemented only upon fulfillment of the following conditions: no objection to the filing with the China Securities Regulatory Commission and approval by the Company’s Shareholders’ Meeting.
12. Within 30 days from the date on which this incentive plan is approved by the Company’s Shareholders’ Meeting, the Company shall convene a Board of Directors meeting in accordance with applicable regulations to grant incentives to the eligible recipients and complete the relevant disclosure and other statutory procedures.
13. The implementation of this incentive plan will not result in the equity distribution failing to meet the requirements for listing.
Table of Contents
Chapter 1: Definitions... 5
Chapter 2: Objectives and Principles of This Incentive Plan... 6
Chapter 3 Management Body of This Incentive Plan... 6
Chapter 4: Criteria and Scope for Determining Incentive Recipients... 6
Chapter 5: Sources, Quantity, and Allocation of Restricted Shares... 7
Chapter 6: Term of This Incentive Plan, Grant Date, Lock-up Period, Vesting Period, and Restriction Period... 8
Chapter 7: Grant Price of Restricted Shares and Method for Determining the Grant Price... 10
Chapter 8: Granting and Vesting Conditions for Restricted Stock... 10
Chapter 9: Methods and Procedures for Adjusting the Restricted Stock Incentive Plan... 12
Chapter 10 Accounting Treatment of Restricted Stocks... 14
Chapter 11: Implementation, Granting, and Vesting Procedures for the Restricted Stock Incentive Plan... 15
Chapter 12: Rights and Obligations of the Company and the Incentive Recipient... 15
Chapter 13: Handling Changes in the Company/Eligible Participants... 16
Chapter 14: Principles for the Repurchase and Cancellation of Restricted Shares... 17
Chapter 15 Supplementary Provisions... 19
Chapter 1: Definitions
Unless otherwise specified, the following terms shall have the meanings set forth below in this document:
Unless otherwise specified, the following terms shall have the meanings set forth below in this document:
|
Daling Shares, this company, the company
|
to point
|
Dalian Refrigeration Co., Ltd. (including its subsidiaries)
|
|
This Incentive Plan
|
to point
|
Dalian Refrigeration Co., Ltd. Restricted Stock Incentive Plan
|
|
Restricted Stock
|
to point
|
The Company shall, in accordance with the terms and price set forth in this Incentive Plan, grant a specified number of the Company’s shares to the eligible recipients. Such shares shall be subject to a vesting period, and may only be vested and become freely tradable upon fulfillment of the vesting conditions stipulated in this Incentive Plan.
|
|
Incentive recipients
|
to point
|
In accordance with the provisions of this incentive plan, the company’s directors, mid- and senior-level management personnel, and other core personnel whom the Board of Directors deems should be incentivized shall be granted restricted shares.
|
|
Grant Date
|
to point
|
The date on which the company grants restricted shares to the incentive recipients must be a trading day.
|
|
Grant Price
|
to point
|
The price at which the Company grants each restricted share to the incentive recipient.
|
|
Lock-up period
|
to point
|
The period during which the restricted shares granted to the incentive recipients under this Incentive Plan are prohibited from being transferred in any form (including for debt repayment).
|
|
Unlock period
|
to point
|
The period during which the restricted shares held by the incentive recipients may be released from restriction and become tradable on the market upon the fulfillment of the vesting conditions set forth in this incentive plan.
|
|
Unlock Conditions
|
to point
|
Conditions that must be satisfied for the vesting of restricted shares granted to the incentive recipients under this Incentive Plan.
|
|
Company Law
|
to point
|
Company Law of the People’s Republic of China
|
|
Securities Law
|
to point
|
Securities Law of the People’s Republic of China
|
|
Administrative Measures
|
to point
|
Administrative Measures for Equity Incentives of Listed Companies (Trial)
|
|
Articles of Association
|
to point
|
Articles of Association of Dalian Refrigeration Co., Ltd.
|
|
China Securities Regulatory Commission
|
to point
|
China Securities Regulatory Commission
|
|
Securities Exchange
|
to point
|
Shenzhen Stock Exchange
|
|
Yuan
|
to point
|
Chinese yuan
|
Chapter 2: Objectives and Principles of This Incentive Plan
In order to further establish and improve the Company’s long-term incentive mechanism, attract and retain top talent, fully motivate the directors, mid- and senior-level management personnel, and core business (technical) staff of Dalian Refrigeration Co., Ltd., effectively align the interests of shareholders, the Company, and the core team, and ensure that all stakeholders are committed to the Company’s long-term development, while fully safeguarding shareholder interests and adhering to the principle of rewarding performance in proportion to contribution, this Incentive Plan is hereby formulated in accordance with the Company Law, the Securities Law, the Administrative Measures, Memoranda No. 1–3 on Equity Incentives, and other relevant laws, regulations, normative documents, as well as the provisions of the Company’s Articles of Association.
Chapter 3: Governing Body of This Incentive Plan
I. The Shareholders’ Meeting, as the Company’s highest authority, is responsible for reviewing and approving the implementation, amendment, and termination of this Incentive Plan. Within the scope of its authority, the Shareholders’ Meeting may delegate certain matters related to this Incentive Plan to the Board of Directors for handling.
II. The Board of Directors serves as the executive management body for this Incentive Plan. Under the Board, the Compensation and Assessment Committee (hereinafter referred to as the “Compensation Committee”) is responsible for formulating and revising the Incentive Plan, submitting it to the Company’s Shareholders’ Meeting for approval and to the competent authorities for review. The Board of Directors may, within the scope of the authorization granted by the Shareholders’ Meeting, handle other matters related to this Incentive Plan.
3. The Supervisory Board serves as the oversight body for this Incentive Plan, responsible for reviewing the list of eligible recipients and ensuring that the implementation of the Incentive Plan complies with applicable laws, regulations, normative documents, and the business rules of the stock exchange.
4. Independent directors shall render an independent opinion on whether this incentive plan is conducive to the company’s sustainable development and whether it involves any circumstances that clearly harm the interests of the company and all shareholders, and shall solicit proxy votes from all shareholders in connection with this incentive plan.
Chapter 4: Basis and Scope for Determining the Recipients of Incentives
I. Basis for Determining the Recipients of Incentives
1. Legal Basis for Determining the Recipients of Incentives
The eligible participants under this incentive plan are determined in accordance with the relevant provisions of applicable laws, regulations, normative documents, including the Company Law, the Securities Law, the Administrative Measures, Memoranda No. 1 to No. 3 on Equity Incentive Matters, and the Company Charter, as well as the specific circumstances of the Company.
2. Job-based criteria for determining incentive recipients
The beneficiaries of this incentive plan shall be the company’s directors, mid- and senior-level management personnel, and other core personnel whom the Board of Directors deems eligible for such incentives.
II. Scope of Incentive Recipients
This incentive plan covers a total of 41 recipients, including:
1. Company director;
2. Mid- and senior-level management personnel of the company;
3. Other core personnel whom the Company’s Board of Directors deems to require incentives.
All incentive recipients must be employed by the Company (including its branches and wholly owned subsidiaries, the same shall apply hereinafter) at the time the Company grants restricted shares and must have executed an employment contract or a labor contract.
III. Verification of Incentive Recipients
1. Upon approval of this incentive plan by the Company’s Board of Directors, the Company’s Supervisory Committee shall verify the list of eligible recipients and disclose the results of such verification at the shareholders’ meeting at which this incentive plan is considered.
2. The list of incentive recipients as adjusted by the Company’s Board of Directors shall also be verified by the Company’s Supervisory Board.
Chapter 5: Sources, Quantity, and Allocation of Restricted Shares
I. Source of Shares for This Incentive Plan
The underlying shares under this incentive plan will be sourced from the Company’s targeted issuance of A-share common stock to the recipients.
II. Number of Restricted Shares Granted
The proposed number of restricted shares to be granted under this incentive plan is 10.15 million, representing 2.900% of the company’s total share capital of 350.014975 million shares as of the date of the draft incentive plan and its summary announcement.
III. Allocation of Restricted Shares Granted to the Incentive Recipients
The allocation of the Company’s restricted shares among the respective incentive recipients is set out in the table below:
|
Name
|
Position
|
Number of Restricted Shares Granted (in ten thousand shares)
|
Proportion of the total number of restricted shares granted
|
Percentage of total share capital
|
|
Ji Zhijian
|
Chairman
|
94.23
|
9.284%
|
0.269%
|
|
Xu Jun Rao
|
Director
|
65.96
|
6.499%
|
0.188%
|
|
Liu Kai
|
Director and General Manager
|
65.96
|
6.499%
|
0.188%
|
|
Wang Zhiqiang
|
Director and Deputy General Manager
|
37.69
|
3.713%
|
0.108%
|
|
Rong Yan
|
Chief Financial Officer
|
37.69
|
3.713%
|
0.108%
|
|
Li Wenjiang
|
Deputy General Manager
|
37.69
|
3.713%
|
0.108%
|
|
Song Wenbao
|
Board Secretary
|
28.28
|
2.786%
|
0.081%
|
|
Middle-level managers and other core personnel deemed by the company’s board of directors to warrant incentives (34 individuals)
|
647.50
|
63.793%
|
1.850%
|
|
|
Total (41 people)
|
1015
|
100.000%
|
2.900%
|
|
Note:
1. The recipients under this incentive plan have not participated in equity incentive plans of two or more listed companies, and the company’s major shareholders holding 5% or more of the shares, as well as the actual controller and their spouses and direct relatives, have not participated in this incentive plan.
2. No individual incentive recipient under the foregoing arrangements has been granted shares of the Company pursuant to all outstanding equity incentive plans in an amount exceeding 1% of the Company’s total share capital. The aggregate number of underlying shares subject to all outstanding incentive plans shall not exceed 10% of the Company’s total share capital as of the date on which the equity incentive plan is submitted to the shareholders’ meeting.
Chapter VI: Term of the Incentive Plan, Grant Date, Lock-up Period, Vesting Period, and Restriction Period
I. Term of This Incentive Plan
The term of this incentive plan shall commence on the date of the grant of the restricted shares and expire on the date when all of the restricted shares granted to the eligible participants have been fully vested or repurchased and cancelled, with a maximum duration of four years.
II. Grant Date of This Incentive Plan
This equity incentive plan shall become effective upon filing with the China Securities Regulatory Commission by the Company’s Board of Directors and upon the issuance of a no-objection notice by the CSRC, following approval by the Company’s Shareholders’ Meeting. The grant date shall be determined by the Company’s Board of Directors, and the Company shall complete all relevant procedures, including the grant, registration, and public announcement of the restricted shares, within 30 days after the approval of the plan by the Shareholders’ Meeting. The grant date must fall on a trading day and may not coincide with any of the following periods:
1. For the period from 30 days prior to the scheduled release of a periodic report to two trading days following the announcement, if the announcement date is postponed for special reasons, the calculation shall commence on the 30th day preceding the originally scheduled announcement date.
2. Within 10 trading days prior to the announcement of the company’s earnings forecast or preliminary earnings report, and within 2 trading days following such announcement;
3. From the decision-making stage of a material transaction or material matter until two trading days after the announcement of such matter;
4. From the date on which any other material event that may affect the stock price occurs until two trading days after the announcement.
III. Lock-up and Vesting Periods under This Incentive Plan
The restricted shares granted under this incentive plan shall be subject to a lock-up period of 12 months from the date of grant. During the lock-up period, the recipients of such restricted shares may not transfer them or use them to repay any debts.
During the vesting period, the Company shall effect the vesting of restricted shares for eligible recipients who have met the vesting conditions; restricted shares held by eligible recipients who have not met the vesting conditions shall be repurchased and cancelled by the Company. The vesting periods and the respective vesting schedules for the restricted shares granted under this incentive plan are set out in the table below:
|
Unlock Arrangement
|
Unlock Time
|
Unlock ratio
|
|
The first unlock period
|
From the first trading day following the 12-month anniversary of the grant date to the last trading day within the 24-month period following the grant date.
|
30%
|
|
Second Unlock Period
|
From the first trading day following the 24-month anniversary of the grant date to the last trading day within the 36-month period from the grant date.
|
40%
|
|
The third vesting period
|
From the first trading day following the 36-month anniversary of the grant date to the last trading day within the 48-month period from the grant date.
|
30%
|
IV. Lock-up Period for This Incentive Plan
The vesting and restriction provisions of this Restricted Stock Incentive Plan shall be governed by the Company Law, the Securities Law, other applicable laws, regulations, normative documents, and the Articles of Association of the Company, as set forth below:
1. Where the recipients of incentives are the company’s directors and senior management, they may not transfer more than 25% of their total holdings of the company’s shares in any given year during their tenure, and they may not transfer any of their holdings of the company’s shares within six months after leaving office.
2. Where the incentive recipients are the company’s directors and senior management, any profits derived from selling shares of the company held by such individuals within six months of purchase, or from repurchasing such shares within six months of sale, shall be deemed to belong to the company, and the company’s board of directors shall recover such profits.
3. During the term of this incentive plan, if any relevant laws, regulations, normative documents, or the Company’s Articles of Association—such as the Company Law and the Securities Law—undergo changes with respect to provisions governing the transfer of shares held by the company’s directors and senior management, then such incentive recipients shall, at the time of any such share transfer, comply with the amended applicable provisions.
Chapter 7: Grant Price of Restricted Shares and Method for Determining the Grant Price
I. Grant Price of Restricted Stocks
The grant price for the restricted shares is RMB 5.56 per share, meaning that, upon fulfillment of the vesting conditions, the eligible recipients may purchase the additional restricted shares issued by Daling Shares at this price.
II. Method for Determining the Grant Price of Restricted Stocks
The grant price shall be no less than 50% of the average trading price of the Company’s shares over the 20 trading days preceding the announcement of this incentive plan (total share trading value over the 20 trading days divided by the total share trading volume over the 20 trading days), which amounts to RMB 5.56 per share, based on an average trading price of RMB 11.11 per share.
Chapter 8: Grant and Vesting Conditions for Restricted Stock
I. Conditions for the Grant of Restricted Stock
The Company shall grant restricted shares to the incentive recipients only when all of the following vesting conditions are satisfied; otherwise, if any one of such vesting conditions is not met, no restricted shares shall be granted to the incentive recipients.
(1) The Company has not experienced any of the following circumstances:
1. The financial statements for the most recent fiscal year have been issued an adverse audit report or a disclaimer of opinion by a certified public accountant;
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past year;
3. Other circumstances as determined by the China Securities Regulatory Commission that render the equity incentive plan inapplicable.
(2) The incentive recipient has not experienced any of the following circumstances:
1. Having been publicly censured by a stock exchange or designated as an unsuitable person within the past three years;
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past three years;
3. Persons who fall under any of the circumstances stipulated in the Company Law that disqualify them from serving as directors or senior management personnel of a company;
4. Other circumstances of serious violation of the Company’s relevant regulations as determined by the Board of Directors.
II. Vesting Conditions for Restricted Shares
During the vesting period, the restricted shares granted to the incentive recipient may be vested only upon simultaneous satisfaction of the following conditions:
(1) The Company has not experienced any of the following circumstances.
1. The financial statements for the most recent fiscal year have been issued an adverse audit report or a disclaimer of opinion by a certified public accountant;
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past year;
3. Other circumstances as determined by the China Securities Regulatory Commission.
(2) The incentive recipient has not experienced any of the following circumstances.
1. Having been publicly censured by a stock exchange or designated as an unsuitable person within the past three years;
2. Having been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws and regulations within the past three years;
3. Falling under any of the circumstances stipulated in the Company Law that disqualify one from serving as a director, supervisor, or senior management personnel of a company;
4. Other circumstances of serious violation of the Company’s relevant regulations as determined by the Board of Directors.
(3) Meet the company-level performance assessment requirements.
The vesting assessment period for this incentive plan spans the three fiscal years 2015–2017, with one assessment conducted each fiscal year. The restricted shares granted to the eligible participants shall become vested only upon achievement of the following performance targets:
|
Unlock period
|
Performance Evaluation Objectives
|
|
The first unlock period
|
In 2015, the operating revenue growth rate shall be no less than 10% compared with 2014; in 2015, the net profit growth rate shall be no less than 10% compared with 2014.
|
|
Second Unlock Period
|
In 2016, the operating revenue growth rate shall be no less than 20% compared with 2014; in 2016, the net profit growth rate shall be no less than 25% compared with 2014.
|
|
The third vesting period
|
In 2017, the operating revenue growth rate shall be no less than 30% compared with 2014; in 2017, the net profit growth rate shall be no less than 40% compared with 2014.
|
The aforementioned net profit growth rate indicator is calculated based on net profit after deducting non-recurring gains and losses, with “net profit for each year” referring to the net profit attributable to shareholders of the listed company.
The incentive costs arising from this incentive plan will be recognized in recurring profit or loss.
During the vesting period, the annual net profit attributable to shareholders of the listed company and the net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses shall each not be lower than the average level of the three most recent fiscal years prior to the grant date and shall not be negative.
(4) In accordance with the Company’s “Assessment and Management Measures for the Restricted Stock Incentive Plan,” the incentive recipients must have achieved a satisfactory performance evaluation in the preceding year.
If the conditions set forth in paragraph (1) above are not met, this incentive plan shall be terminated, and all unvested restricted shares granted to all eligible participants shall be repurchased and cancelled by the Company; if the conditions set forth in paragraph (3) above are not met, no restricted shares that would otherwise become vested in the assessment year for any eligible participant shall vest, and such shares shall be repurchased and cancelled by the Company; if an individual eligible participant fails to meet the conditions set forth in paragraph (2) above, the restricted shares that would otherwise become vested in the assessment year for such participant shall not vest, and such shares shall be repurchased and cancelled by the Company; and if an eligible participant fails to meet the conditions set forth in paragraph (4) above, the restricted shares that would otherwise become vested in the assessment year for such participant shall not vest, and such shares shall be repurchased and cancelled by the Company.
Chapter 9: Methods and Procedures for Adjusting the Restricted Stock Incentive Plan
I. Method for Adjusting the Number of Restricted Shares
If, during the period from the date of announcement of this incentive plan to the date on which the eligible recipients complete the registration of the restricted shares, the Company undertakes any capitalization of capital reserves into share capital, distribution of stock dividends, stock split, rights issue, or reverse stock split, the number of restricted shares shall be adjusted accordingly. The adjustment method is as follows:
1. Capitalization of capital reserves, distribution of stock dividends, and stock splits
Q = Q0 × (1 + n)
Where: Q0 is the number of restricted shares prior to adjustment; n is the ratio of capital reserve transfer to share capital, stock dividend distribution, or stock split per share (i.e., the number of additional shares issued per share following such capitalization, dividend distribution, or split); and Q is the number of restricted shares after adjustment.
2. Rights Issue
Q = Q0 × P1 × (1 + n) ÷ (P1 + P2 × n)
Where: Q0 is the number of restricted shares prior to adjustment; P1 is the closing price on the equity registration date; P2 is the rights issue price; n is the rights issue ratio (i.e., the ratio of the number of shares issued in the rights issue to the company’s total share capital before the rights issue); and Q is the number of restricted shares after adjustment.
3. Share Reduction
Q = Q0 × n
Where: Q0 is the number of restricted shares prior to the adjustment; n is the share consolidation ratio (i.e., 1 share of the company’s stock is consolidated into n shares); and Q is the number of restricted shares after the adjustment.
4. Additional Issuance
In the event of a new share issuance, the number of restricted shares shall remain unchanged.
II. Methods for Adjusting the Grant Price of Restricted Stocks
If, during the period from the date of announcement of this incentive plan to the date on which the eligible recipients complete the registration of the restricted shares, the Company undertakes any of the following actions—capitalization of capital reserves into share capital, distribution of stock dividends, stock split, rights issue, reverse stock split, or dividend distribution—the grant price of the restricted shares shall be adjusted accordingly. The adjustment method is as follows:
1. Capitalization of capital reserves, distribution of stock dividends, and stock splits
P = P0 ÷ (1 + n)
Where: P0 is the grant price before adjustment; n is the ratio of capital reserve capitalization, stock dividends, and stock splits per share; and P is the adjusted grant price.
2. Rights Issue
P = P0 × (P1 + P2 × n) ÷ [P1 × (1 + n)]
Where: P0 is the grant price before adjustment; P1 is the closing price on the equity registration date; P2 is the rights issue price; n is the rights issue ratio (i.e., the ratio of the number of shares issued in the rights issue to the total share capital of the company prior to the rights issue); and P is the adjusted grant price.
3. Share Reduction
P = P0 ÷ n
Where: P0 is the grant price before adjustment; n is the stock consolidation ratio; and P is the adjusted grant price.
4. Dividend Distribution
P = P0 - V
Where: P0 is the grant price before adjustment; V is the dividend per share; and P is the adjusted grant price. After the dividend adjustment, P must still be greater than 1.
5. Additional Issuance
In the event of a subsequent public offering of new shares, the grant price of restricted stock shall remain unchanged.
III. Procedures for Adjusting the Restricted Stock Incentive Plan
The Company’s Shareholders’ Meeting has authorized the Board of Directors to determine, in the event of the aforementioned circumstances, any adjustments to the grant price and the number of restricted shares. Following such adjustments to the number and grant price in accordance with the foregoing provisions, the Board shall promptly make a public announcement. The Company shall engage counsel to provide a professional opinion to the Board as to whether such adjustments comply with the Provisions on Equity Incentive Management, the Company’s Articles of Association, and the terms of this Incentive Plan.
Chapter 10 Accounting Treatment of Restricted Stock
In accordance with Accounting Standard for Business Enterprises No. 11—Share-based Payment, the Company will, at each balance sheet date during the vesting period, revise the estimated number of restricted shares that are expected to become vested based on subsequently obtained information, such as changes in the number of employees eligible for vesting and the achievement of performance targets, and recognize the services received in the current period at the fair value of the restricted shares on the grant date, charging the corresponding amount to the relevant cost or expense and to capital surplus.
(1) Accounting Treatment Methods
1. Grant Date
Share capital and capital surplus are recognized based on the company’s targeted issuance of shares to the incentive recipients.
2. At each balance sheet date during the lock-up period
According to accounting standards, on each balance sheet date during the vesting period, the services rendered by employees are recognized as cost or expense, while corresponding equity or liability is simultaneously recognized.
3. Unlock Day
On the vesting date, if the vesting conditions are met, the shares shall be vested; if all or part of the shares fail to vest and thereby lapse or become void, such treatment shall be in accordance with accounting standards and relevant regulations.
(II) Estimated Impact of the Implementation of Restricted Stock Awards on Operating Performance in Each Period
Assuming the Company granted 10.15 million restricted shares to the incentive recipients on April 1, 2015, with the closing price of the Company’s stock on the grant date being RMB 11.27 per share, the total amortization expense for the restricted shares, as calculated using the relevant valuation tools, amounts to RMB 20.5282 million. This aggregate fair value will be recognized in installments over the vesting period of the equity incentive plan, in accordance with the vesting schedule. The Company’s specific amortization schedule for the years 2015–2018 is set out in the table below:
|
Number of restricted shares
(ten thousand shares)
|
Total cost
(Ten thousand yuan)
|
2015 year
(Ten thousand yuan)
|
2016 year
(Ten thousand yuan)
|
2017 year
(Ten thousand yuan)
|
2018 year
(Ten thousand yuan)
|
|
1015
|
2052.82
|
923.77
|
769.81
|
307.92
|
51.32
|
Based on the current circumstances, the Company estimates that, absent the stimulative effect of the incentive plan on corporate performance, the amortization of the plan’s expenses will have some impact on net profit in each year of the plan’s term; however, this impact is expected to be relatively minor. Taking into account the positive impact of the incentive plan on the Company’s development—namely, its ability to boost management team motivation, enhance operational efficiency, and reduce agency costs—the resulting improvement in corporate performance will far outweigh the incremental expense incurred as a result of the plan.
Chapter 11 Implementation, Granting, and Vesting Procedures for the Restricted Stock Incentive Plan
I. Upon obtaining the China Securities Regulatory Commission’s no-objection filing, this incentive plan shall be submitted to the Company’s Shareholders’ Meeting for deliberation and approval. When the Shareholders’ Meeting votes on the restricted stock incentive plan, the independent directors shall solicit proxy votes from all shareholders in favor of the plan, and the Company shall provide both on-site voting and online voting options.
II. Upon approval by the Company’s Shareholders’ Meeting and fulfillment of the grant conditions set forth in this Incentive Plan, the Company shall grant restricted shares to the eligible recipients within the prescribed time frame. The grant date must fall on a trading day and comply with other relevant provisions of this Incentive Plan.
III. Grant and Vesting Procedures for Restricted Shares:
(1) Grant of Restricted Stock
Following the approval of this incentive plan by the shareholders’ meeting, the company’s board of directors shall, pursuant to the authorization granted by the shareholders’ meeting, handle the specific matters related to the grant of restricted shares.
(2) Restricted Stock Vesting Procedures
1. Prior to the vesting date, the Company shall verify whether each incentive recipient meets the vesting conditions. For those recipients who meet the conditions, the Company shall handle the vesting process in a centralized manner and issue a “Notice of Vesting of Restricted Shares” to such recipients. For those recipients who do not meet the conditions, the Company shall repurchase and cancel the restricted shares corresponding to the current vesting tranche held by them.
2. The incentive recipients may transfer the restricted shares that have been unlocked; however, any transfer of shares held by the company’s directors and senior management must comply with applicable laws, regulations, and normative documents.
Chapter 12: Rights and Obligations of the Company and the Incentive Recipient
I. Rights and Obligations of the Company
(1) The Company shall have the authority to interpret and administer this Incentive Plan and, in accordance with its provisions, conduct performance evaluations of the Incentive Recipients. If an Incentive Recipient fails to meet the vesting conditions set forth in this Incentive Plan, the Company shall, pursuant to the principles stipulated in this Incentive Plan, repurchase and cancel the corresponding unvested Restricted Shares held by such Recipient at the purchase price paid by the Recipient.
(2) The Company undertakes not to provide any loans or other forms of financial assistance, including guarantees for loans, to the incentive recipients in connection with their acquisition of restricted shares under this Incentive Plan.
(3) The Company shall promptly fulfill its obligations under applicable regulations with respect to the filing and disclosure of information related to the restricted stock incentive plan.
(4) The Company shall, in accordance with this Incentive Plan and the relevant provisions of the China Securities Regulatory Commission, the stock exchanges, and China Securities Depository & Clearing Corporation Limited, actively cooperate to ensure that eligible incentive recipients whose vesting conditions have been met may exercise their options in compliance with applicable regulations. However, if, due to reasons attributable to the China Securities Regulatory Commission, the stock exchanges, or China Securities Depository & Clearing Corporation Limited, an incentive recipient is unable to exercise options at his or her own discretion and such failure results in losses to the recipient, the Company shall not be held liable.
II. Rights and Obligations of the Incentive Recipients
(1) The recipients of incentives shall, in accordance with the requirements of their positions as employed by the Company, perform their duties diligently and conscientiously, uphold professional ethics, and make due contributions to the Company’s development.
(2) The recipients of the incentive shall lock up the restricted shares granted to them in accordance with the provisions of this Incentive Plan.
(3) The funds used by the incentive recipients shall be self-financed.
(4) The restricted shares granted to the incentive recipients may not be transferred or used to repay debts during the lock-up period.
(5) Any income received by the recipients under the incentive plan shall be subject to individual income tax and other applicable taxes in accordance with national tax laws and regulations.
(6) Other relevant rights and obligations as stipulated by laws, regulations, and this Incentive Plan.
Chapter 13: Treatment of Changes in the Company/Eligible Participants
I. In the event that any of the following circumstances occur at the Company, the handling of this incentive plan shall be as follows:
(1) If there is a change in the company’s control, this incentive plan shall be implemented as normal;
(2) If the Company undergoes a merger, spin-off, or other similar corporate restructuring, this Incentive Plan shall be terminated.
(3) If the financial statements for the most recent fiscal year receive an adverse audit opinion or a disclaimer of opinion from the certified public accountant, this incentive plan shall be terminated.
(4) If the Company has been subject to administrative penalties by the China Securities Regulatory Commission for material violations of laws or regulations within the past year, this incentive plan shall be terminated.
(5) Other circumstances as determined by the China Securities Regulatory Commission that necessitate the termination of the incentive plan.
In the event that any of the termination circumstances set forth in Clauses (2) through (5) above occur with respect to the Company’s incentive plan, any restricted shares that have been granted to the incentive recipient but have not yet been vested shall not be vested and shall be repurchased and cancelled by the Company.
II. Changes in the Personal Circumstances of the Incentive Recipients
(1) If an incentive recipient experiences a change in position but remains employed by the Company or by one of its subsidiaries or branch offices, the restricted shares granted to such recipient shall be subject to the procedures set forth in this Incentive Plan as in effect prior to the change in position. However, if the change in position results from the recipient’s failure to perform the duties of the position, violation of law, breach of professional ethics, disclosure of company confidential information, negligence or dereliction of duty, or other conduct that harms the Company’s interests or reputation; or if the Company terminates the employment relationship with the recipient for any of the foregoing reasons, the restricted shares that have been granted but not yet vested shall not vest and shall be repurchased and cancelled by the Company.
(2) If an incentive recipient leaves the company due to resignation or workforce reduction, any restricted shares that have been granted but not yet vested shall not vest and shall be repurchased and cancelled by the company.
(3) If an incentive recipient retires or otherwise leaves the Company and no longer serves as an employee, any restricted shares that have been granted but not yet vested shall not be vested and shall be repurchased and cancelled by the Company.
(4) Where the incentive recipient leaves employment due to loss of work capacity, the matter shall be handled in the following two scenarios:
1. If an incentive recipient leaves employment due to loss of work capacity while performing their duties, the restricted shares granted to such recipient shall be subject to the procedures set forth in this incentive plan as they would have been prior to the loss of work capacity; the recipient’s individual performance appraisal results shall no longer be taken into account as a condition for vesting.
2. If the incentive recipient leaves employment not due to loss of work capacity arising from the performance of duties, any restricted shares that have been granted but not yet vested shall not vest and shall be repurchased and cancelled by the Company.
(5) In the event of the death of an incentive recipient, any restricted shares that have been granted but not yet vested shall not be vested and shall be repurchased and cancelled by the Company.
(6) Any other circumstances not specified herein shall be determined by the Board of Directors, which shall also decide the appropriate course of action.
Chapter 14: Principles for the Repurchase and Cancellation of Restricted Shares
If the Company repurchases and cancels restricted shares in accordance with the provisions of this Incentive Plan, the repurchase price shall be the grant price, unless adjustments to the repurchase price are required under this Incentive Plan.
(1) Method for Adjusting the Repurchase Price
Upon completion of the share registration for the restricted shares granted to the incentive recipients, if the Company undertakes any capitalization of capital reserves into share capital, distribution of stock dividends, stock splits, rights issues or reverse stock splits, or dividend payments—any event that affects the total share capital or the market price of the Company’s shares—the Company shall make corresponding adjustments to the repurchase price of the unvested restricted shares in accordance with the following adjustment methodology:
1. Capitalization of capital reserves, distribution of stock dividends, and stock splits
P = P0 ÷ (1 + n)
Where: P is the adjusted repurchase price per restricted share, P0 is the grant price per restricted share; n is the ratio of capitalization of surplus reserves into share capital, distribution of stock dividends, or stock split (i.e., the number of additional shares issued for each share following such capitalization, dividend distribution, or stock split).
2. Rights Issue
P = P0 × (P1 + P2 × n) ÷ [P1 × (1 + n)]
Where: P1 is the closing price on the record date for equity; P2 is the rights issue price; and n is the rights issue ratio (i.e., the ratio of the number of shares issued in the rights offering to the company’s total share capital prior to the offering).
3. Share Reduction
P = P0 ÷ n
Where: P is the adjusted repurchase price per restricted share, P0 is the grant price per restricted share; and n is the stock split ratio (i.e., 1 share is split into n shares).
4. Dividend Distribution
P = P0 - V
Where: P0 is the pre-adjustment repurchase price per restricted share; V is the dividend per share; and P is the post-adjustment repurchase price per restricted share. Following the dividend adjustment, P must still be greater than 1.
(2) Procedures for Adjusting the Repurchase Price
1. The Company’s Shareholders’ Meeting hereby authorizes the Board of Directors to adjust the repurchase price of the restricted shares in accordance with the reasons set forth above. Following such adjustment, the Board of Directors shall promptly make an announcement.
2. Any adjustment to the repurchase price of restricted shares for other reasons shall be subject to a resolution passed by the Board of Directors and subsequent review and approval by the Shareholders’ Meeting.
(3) Procedures for Repurchase and Cancellation
When the Company implements share repurchases in accordance with the provisions of this Incentive Plan, it shall apply to the stock exchange for the release of restrictions on such restricted shares. Within thirty business days after the restrictions are lifted, the Company shall pay the repurchase consideration to the eligible participants and complete the transfer of the corresponding shares through the registration and clearing institution; within a reasonable period following completion of the transfer, the Company shall cancel such shares.
Chapter XV Supplementary Provisions
1. This incentive plan shall become effective upon filing with the China Securities Regulatory Commission without objection and upon approval by the Company’s Shareholders’ Meeting.
II. The Company’s Board of Directors shall be responsible for interpreting this Incentive Plan.
Board of Directors of Dalian Refrigeration Co., Ltd.
February 12, 2015
这里是标题一h1占位文字
Message Board
Group dynamics
Contact us
Dalian Bingshan Group Co., Ltd.
Address: No. 106, Liaohe East Road, Dalian Economic & Technological Development Zone
Phone:
0411-87968888 (Main Line)
0411-87968930, 8931 (Sales)
0411-87968000 (After-Sales Service)
400-0411-380 (Customer Service Hotline)
Copyright © 2026 Bingshan Cold & Heat Technology Co., Ltd.
