CVTE (002841): Beijing Junhe (Guangzhou) Law Firm’s legal opinion on CVTE’s termination of the implementation of the 2022 restricted stock incentive plan, adjustment of the repurchase price and repurchase and cancellation of restricted shares – CFi. CN China Finance Network

Original title: CVTE: Beijing Junhe (Guangzhou) Law Firm’s legal opinion on CVTE’s termination of the implementation of the 2022 restricted stock incentive plan, adjustment of the repurchase price and repurchase and cancellation of restricted shares.

Beijing Junhe (Guangzhou) Law Firm
Regarding the termination of the implementation of 2022 restricted stocks by Guangzhou Shiyuan Electronic Technology Co., Ltd.
Incentive plans, adjustments to repurchase prices and matters related to the repurchase and cancellation of restricted stocks
legal advice
To: Guangzhou Shiyuan Electronic Technology Co., Ltd.
Beijing Junhe (Guangzhou) Law Firm (hereinafter referred to as the “firm”) accepted the entrustment of Guangzhou Shiyuan Electronic Technology Co., Ltd. (hereinafter referred to as the “company”) as a special legal advisor to advise the company on the termination of the company’s implementation of the company’s 2022 restrictions. For matters related to the stock incentive plan (hereinafter referred to as the “2022 Incentive Plan” or “this incentive plan”), adjustment of the repurchase price and repurchase and cancellation of restricted stocks (hereinafter referred to as “this termination and repurchase and cancellation”), this document is issued legal advice.

This legal opinion is based on the Company Law of the People’s Republic of China, the Securities Law of the People’s Republic of China (hereinafter referred to as the “Securities Law”), the “Administrative Measures for Equity Incentives of Listed Companies” (hereinafter referred to as the “Administrative Measures”) and other Chinese (hereinafter referred to as the “Administrative Measures”) “China” includes the Hong Kong Special Administrative Region, the Macao Special Administrative Region and Taiwan. For the purpose of this legal opinion, it only refers to the laws, regulations and normative documents of the Mainland China (hereinafter referred to as “Chinese Laws”), in accordance with the generally accepted standards of the legal profession. Business standards, ethics and diligence are issued.

In order to issue this legal opinion, our firm and our lawyers have reviewed the documents that need to be consulted in accordance with the “Administrative Measures for Law Firms Engaging in Securities Legal Business” and the “Law Firms’ Securities Legal Business Practice Rules (Trial)” and other relevant regulations. and other documents that our attorneys deem necessary to review. The Company guarantees that it has provided the original written materials, duplicate materials, copied materials, confirmation letters or oral confirmations required by the Firm for issuing this legal opinion, and that the materials and information provided to the Firm are true, accurate, complete and effective. , if there are no concealed records, false statements or major omissions, and the documents are copies or photocopies, they shall be consistent with the originals. On this basis, our firm reasonably used written review, communication with company staff and other methods to verify and confirm the relevant facts.

Our firm and our lawyers comply with the provisions of the Securities Law, the Administrative Measures for Law Firms Engaging in Securities Legal Business, and the Rules for the Practice of Securities Legal Business of Law Firms (Trial), as well as the matters that have occurred or existed before the date of issuance of this legal opinion. facts, strictly performed legal duties, followed the principles of diligence and good faith, and conducted sufficient investigations. Beijing Headquarters Telephone: (86-10) 8519-1300 Shanghai Branch Telephone: (86-21) 5298-5488 Guangzhou Branch Telephone :(86-20)2805-9088 Shenzhen Branch Tel: (86-755)2939-5288
Fax: (86-10) 8519-1350 Fax: (86-21) 5298-5492 Fax: (86-20) 2805-9099 Fax: (86-755) 2939-5289 Hangzhou Branch Tel: (86-571) 2689-8188 Chengdu Branch Tel: (86-28) 6739-8000 Xi’an Branch Tel: (86-29) 8550-9666 Qingdao Branch Tel: (86-532) 6869-5000
Fax: (86-571) 2689-8199 Fax: (86-28) 67398001 Fax: (86-532) 6869-5010 Dalian Branch Telephone: (86-411) 8250-7578 Haikou Branch Telephone: (86-898 )3633-3401 Hong Kong branch: (852) 2167-0000 New York branch: (1-737) 215-8491
Fax: (86-411) 8250-7579 Fax: (86-898) 3633-3402 Fax: (852) 2167-0050 Fax: (1-737) 215-8491 Verification to ensure that the facts identified in this legal opinion are true , accurate and complete, the concluding opinions expressed are legal and accurate, there are no false records, misleading statements or major omissions, and corresponding legal responsibilities shall be borne.

The Firm only expresses opinions on legal issues related to this termination and repurchase and cancellation, and only expresses legal opinions in accordance with Chinese laws, and does not express legal opinions in accordance with any laws outside China. This firm does not express opinions on non-legal professional matters such as the value of the underlying stocks involved in this termination, repurchase and cancellation. When quoting relevant financial data or conclusions in this legal opinion, our firm has fulfilled the necessary duty of care, but such quotations should not be regarded as any express or explicit representation by our firm as to the authenticity and accuracy of these data and conclusions. Implied warranties.

For facts that are crucial to the issuance of this legal opinion but cannot be supported by independent evidence, our firm relies on explanations or supporting documents issued by relevant government departments, companies or other relevant units to issue legal opinions.

The Exchange agrees that the company will use this legal opinion as one of the necessary documents for its implementation of this termination and repurchase and cancellation, and that it will complete the reporting procedures or make public disclosures along with other materials in accordance with relevant regulations and the requirements of the regulatory authorities, and will review the legal opinions issued. Bear corresponding legal responsibilities.

This legal opinion is only used by the company for the purpose of implementing this termination and repurchase and cancellation, and may not be used for any other purpose. The Exchange agrees that the company may quote the relevant content of this legal opinion in the relevant documents related to this termination and repurchase and cancellation. However, when the company makes the above reference, it shall not cause ambiguity or misinterpretation due to the reference. The Exchange reserves the right to review the corresponding content of the relevant documents again. and confirm.

1. Approval and authorization of this termination and repurchase and cancellation
(1) On September 29, 2022, the company held a meeting of the Remuneration and Appraisal Committee of the Board of Directors to review and approve the “Guangzhou Shiyuan Electronic Technology Co., Ltd. 2022 Restricted Stock Incentive Plan (Draft)” and its summary, and incorporated the “Guangzhou Shiyuan Electronic Technology Co., Ltd. Electronic Technology Co., Ltd. 2022 Restricted Stock Incentive Plan (Draft)” and its summary were submitted to the company’s board of directors for review.

(2) On September 29, 2022, the company held the 21st meeting of the fourth board of directors, which reviewed and approved the “Guangzhou Shiyuan Electronic Technology Co., Ltd. 2022 Restricted Stock Incentive Plan (Draft)” and its summary and other related On the proposal, the associated directors abstained from voting in accordance with regulations. On the same day, the company’s independent directors issued independent opinions agreeing with this incentive plan.

(3) On September 29, 2022, the company held the 20th meeting of the fourth session of the Board of Supervisors. The meeting reviewed the awards determined in the “Guangzhou Shiyuan Electronic Technology Co., Ltd. 2022 Restricted Stock Incentive Plan (Draft)” The list of incentive targets granted restricted stocks was verified.

(4) On October 26, 2022, the company’s second extraordinary shareholders’ meeting in 2022 reviewed and approved the “Guangzhou Shiyuan Electronic Technology Co., Ltd. 2022 Restricted Stock Incentive Plan (Draft)” (hereinafter referred to as the “2022 Incentive Plan”). Plan”) and its summary and other related proposals, related shareholders abstained from voting in accordance with regulations.

(5) On October 26, 2022, the company held the 23rd meeting of the fourth board of directors, which reviewed and approved the “Proposal on Granting Restricted Stocks to the Initial Incentive Objects of the 2022 Restricted Stock Incentive Plan”. Avoid voting. On the same day, the company’s independent directors issued independent opinions.

(6) On October 26, 2022, the company held the 22nd meeting of the fourth session of the Supervisory Board to discuss the “About 2022
The list of incentive targets who were granted restricted stocks this time was verified as determined in the Proposal on Granting Restricted Stocks to Initial Incentive Objects of the 2016 Restricted Stock Incentive Plan.

(7) On April 24, 2024, the company held a meeting of the Remuneration and Assessment Committee of the Board of Directors, and reviewed and approved the “About terminating the implementation of the restricted stock incentive plan, adjusting the repurchase price, and repurchasing and canceling restricted stocks that have been granted but have not yet been released from sale restrictions.” motion”.

(8) On April 24, 2024, the company held the second meeting of the fifth board of directors, which reviewed and approved the “About terminating the implementation of the restricted stock incentive plan, adjusting the repurchase price, and repurchasing and canceling the restrictions on sales that have been granted but have not yet been lifted.” “Proposal on Restricted Stocks” and decided to terminate the implementation of the 2022 incentive plan and repurchase and cancel all restricted stocks that have been granted but have not yet been released.

(9) On April 24, 2024, the company held the second meeting of the fifth board of supervisors and reviewed and approved the “About terminating the implementation of the restricted stock incentive plan, adjusting the repurchase price and repurchasing and canceling the restrictions on sales that have been granted but have not yet been lifted.” “Proposal on Sexual Stocks”, agreeing to terminate the implementation of the 2022 incentive plan and repurchase and cancel all restricted stocks that have been granted but have not yet been released.

In summary, this termination and repurchase and cancellation have obtained the necessary approvals and authorizations at this stage, and are in compliance with the relevant provisions of the “Management Measures” and the “2022 Incentive Plan”. This termination and repurchase and cancellation still need to be submitted to the company’s shareholders’ meeting for review. The company still needs to fulfill its information disclosure obligations in accordance with relevant laws and regulations, and go through relevant procedures for reducing registered capital and canceling share registration.

2. The situation of this termination and repurchase and cancellation
(1) Reasons for this termination and repurchase cancellation
According to the “Proposal on Terminating the Implementation of the Restricted Stock Incentive Plan, Adjusting the Repurchase Price, and Repurchasing and Cancelling Restricted Stocks that have been granted but have not yet been released from sales restrictions” reviewed and approved by the second meeting of the fifth session of the Board of Directors, this termination and The reasons for repurchase and cancellation are as follows: In view of the fact that the internal and external environment faced by the company’s operations has changed significantly compared with the time when the equity incentive plan was formulated, resulting in a deviation between the company’s expected operating conditions and the setting of the assessment indicators of the incentive plan, the incentive plan will continue to be implemented. The plan will be difficult to achieve the expected incentive purposes and effects. After comprehensive consideration of the company’s industry, its actual operating conditions and the company’s future development strategic plan, and after careful review, it was decided to terminate the implementation of this incentive plan and repurchase and cancel all restricted stocks that have been granted to the incentive targets but have not yet been released.

(2) The number of restricted shares canceled during this repurchase
According to the “Proposal on Terminating the Implementation of the Restricted Stock Incentive Plan, Adjusting the Repurchase Price, and Repurchasing and Cancelling Restricted Stocks that have been granted but have not yet been released from sale restrictions” reviewed and approved by the second meeting of the fifth session of the Board of Directors, the proposed repurchase plan A total of 5.2225 million shares of restricted stocks that have been granted to incentive targets but have not yet been released from sales restrictions have been purchased and canceled.

(3) The price of the restricted stock repurchase and its adjustment
According to the “Proposal on Terminating the Implementation of the Restricted Stock Incentive Plan, Adjusting the Repurchase Price, and Repurchasing and Cancelling Restricted Stocks that have been granted but have not yet been released from sale restrictions” reviewed and approved by the second meeting of the fifth session of the Board of Directors, the company’s repurchase The price is the grant price (31.65 yuan/share) plus bank deposit interest for the same period.

According to the provisions of Article 26 of the “Administrative Measures”, if you are personally responsible for the occurrence of the situation in Article 18, paragraph 1, of the Measures, or if the situation occurs in the second paragraph of Article 18 of the Measures, the repurchase price shall not be higher in other circumstances, the repurchase price shall not be higher than the sum of the grant price plus bank deposit interest for the same period.

According to the provisions of “Chapter 8, Conditions for Granting and Unlocking Restrictions of Restricted Stocks” of the “2022 Incentive Plan”, if the company fails to meet the performance assessment goals, all incentive targets will not be allowed to release restricted stocks in the corresponding assessment year. After the sales restriction is lifted, the company will repurchase and cancel the shares. The repurchase price is the sum of the grant price plus bank deposit interest for the same period.

According to the provisions of “Chapter 14, Principles for Repurchase and Cancellation of Restricted Stocks” of the “2022 Incentive Plan”, after the restricted stocks granted to the incentive objects have been registered, if the company converts capital reserves into share capital and distributes stock dividends, , share subdivision, rights issue, share reduction or dividend payment and other matters that affect the company’s total share capital or the company’s stock price, the company should make corresponding adjustments to the repurchase price of the restricted stocks that have not yet been lifted. The details of the repurchase price adjustment method when dividends are paid are as follows:
P=P0-V, where: P0 is the repurchase price before adjustment; V is the dividend amount per share; P is the repurchase price after adjustment. After adjusting for dividends, P must still be greater than 1.

In view of the completion of share registration for the restricted stocks granted to the incentive objects, the company implemented the 2022 annual equity distribution. According to the company’s 2022 annual profit distribution plan, based on the company’s total share capital of 701,239,045 shares, 10.5 yuan will be distributed to all shareholders for every 10 shares. RMB cash (tax included).

The company’s “Profit Distribution Plan for 2023” has been reviewed and approved at the second meeting of the fifth board of directors and still needs to be submitted to the company’s 2023 annual shareholders’ meeting for review. The profit distribution plan for 2023 drawn up by the company’s board of directors is: based on the company’s total share capital of 701,239,045 shares, a cash dividend of RMB 8.50 (tax included) will be distributed to all shareholders for every 10 shares.

In summary, the company’s repurchase price should be adjusted accordingly based on the company’s dividend payment situation from the completion of share registration of the restricted stocks granted to the incentive targets to the date of implementation of the repurchase. The adjustment situation and the company’s The total amount of funds paid for this restricted stock repurchase is as follows:
(1) If the company’s “Profit Distribution Plan for 2023” has not been completed when this repurchase is implemented, the repurchase price will be the grant price adjusted for the 2022 profit distribution (P=31.65-1.05=30.60 yuan) /share) plus bank deposit interest for the same period, the total amount of funds paid by the company for this restricted stock repurchase is approximately 164 million yuan.

(2) If the company’s “Profit Distribution Plan for 2023” has been implemented when this repurchase is implemented, the repurchase price will be the grant price adjusted for profit distribution in 2022 and 2023.
(P=31.65-1.05-0.85=29.75 yuan/share) Including bank deposit interest for the same period, the total amount of funds paid by the company for this restricted stock repurchase is approximately 160 million yuan.

(4) Source of funds for this repurchase of restricted shares
According to the “Proposal on Terminating the Implementation of the Restricted Stock Incentive Plan, Adjusting the Repurchase Price, and Repurchasing and Cancelling Restricted Stocks that have been granted but have not yet been released from sales restrictions” reviewed and approved by the second meeting of the fifth session of the Board of Directors, this repurchase The funds for restricted stocks are the company’s own funds.

(5) Whether there is any situation that obviously damages the interests of the company and all shareholders
According to the company’s explanation and the opinions expressed by the company’s independent directors and the board of supervisors on this termination, repurchase and cancellation, the company’s current termination and repurchase and cancellation will not significantly damage the interests of the company and all shareholders.

In summary, the reasons, quantities, repurchase prices and adjustments as well as the sources of funds for this termination and repurchase and cancellation are in compliance with the relevant provisions of the “Management Measures” and the “2022 Incentive Plan”, and there is no situation that will obviously harm the interests of the company and all shareholders. .

3. Conclusions
To sum up, as of the date of issuance of this legal opinion, the necessary approvals and authorizations for this termination and repurchase and cancellation have been obtained at this stage, and are in compliance with the relevant provisions of the “Management Measures” and “2022 Incentive Plan”. This termination and repurchase and cancellation still need to be submitted to the company’s shareholders’ meeting for review. The company still needs to fulfill its information disclosure obligations in accordance with relevant laws and regulations, and go through relevant procedures for reducing registered capital and canceling share registration. The reasons, quantity, repurchase price and adjustment as well as the sources of funds for this termination and repurchase and cancellation are in compliance with the relevant provisions of the “Management Measures” and the “2022 Incentive Plan”, and there is no situation that will obviously harm the interests of the company and all shareholders.

This legal opinion is made in triplicate and will take effect after being signed by our lawyers and stamped with our official seal.

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