Stock Code: 200771 Stock ID: Hangqilun B Announcement No.: 2022-03
Hangzhou Steam Turbine Co., Ltd.
Announcement on the Completion of Registration of the Granting Grant of Restricted Stock
Incentive Plan in 2021
The members of the Board and the Company acknowledge being responsible for the truthfulness,
accuracy, and completeness of the announcement. Not any false record, misleading statement or
significant omission carried in this announcement.
Special Tips:
1.Listing date for restricted stock: January 14, 2022.
2.Registered number of restricted stock granted: 1,380,000 shares
3.Grant price of restricted stock: HKD 6.825/share（RMB 5.5660/shares, and the exchange
rate of HKD to RMB is 0.81553)
4.Registered number of people granted with restricted stock: 37
5.Source of restricted stock: B common stock repurchased by the Company from the
secondary market
According to the Administrative Measures on Equity Incentives of Listed Companies issued
by China Securities Regulatory Commission and the relevant rules of Shenzhen Stock Exchange
and Shenzhen Branch of China Securities Depository and Clearing Co., Ltd., Hangzhou Steam
Turbine Co., Ltd. (hereinafter referred to as "the Company") has completed the registration of the
Granting grant of the restricted stock incentive plan in 2021, and the relevant details are
announced as follows:
I. Relevant decision-making procedures and information disclosure that have been
implemented in this incentive plan
1. On July 11, 2021, the 14th meeting of the Eighth Board of Directors reviewed and approved the
Proposal on the Company's Restricted Stock Incentive Plan (Draft) in 2021 and its Summary, the
Proposal on the Company's Implementation Assessment Management Measures for the Restricted
Stock Incentive Plan in 2021, and the Proposal on Requesting the General Meeting of Shareholders
to Authorize the Board of Directors to Handle Matters Related to the Restricted Stock Incentive
Plan in 2021, and the 9th Meeting of the Eighth Supervisors of the Company reviewed and
approved the above related proposals. The Company disclosed related announcements such as the
Restricted Stock Incentive Plan (Draft) and its Summary in 2021, the Implementation Assessment
Management Measures for the Restricted Stock Incentive Plan in 2021, the Incentive Object List of
the Restricted Stock Incentive Plan in 2021, the Self-inspection Form of Equity Incentive Plan, and
the Legal Opinions of Shanghai Jintiancheng Law Firm on the 2021 Restricted Stock Incentive
Plan of Hangzhou Steam Turbine Co., Ltd.
Independent directors of the Company expressed their independent opinions on whether the
equity incentive plan is conducive to the sustainable development of the Company and whether
there is any harm to the interests of the Company and all shareholders.The Board of Supervisors of
the Company issued the Verification Opinions on the Company's Restricted Stock Incentive Plan
(Draft) in 2021.
2. On August 12, 2021, the Company disclosed the Announcement on the Approval of Equity
Incentive Plan by Hangzhou SASAC. The Company received the Reply of Hangzhou Steam Turbine
Co., Ltd. on Implementing the Restricted Stock Incentive Plan in 2021 (HGZK [2021] No.45), and
Hangzhou SASAC agreed in principle that the Company should implement the restricted stock
incentive plan in 2021.
3. From July 12, 2021 to July 21, 2021, the Company publicized the names and positions of
the incentive objects by posting the Publicity of the Company's Restricted Stock Incentive Objects
in 2021 on the Company's business premises, specifying the circumstances that forbids to be equity
incentive objects, and the ways and means of feedback during the publicity period. As of the
expiration of the publicity period, the Company has not received any objection from any
organization or individual to the incentive object of this incentive plan.
On August 23, 2021, the Company disclosed the Publicity and Verification Opinions of the
Board of Supervisors of the Company on the List of Incentive Objects of Restricted Stock Incentive
Plan. The Board of Supervisors of the Company believes that the incentive objects listed in this
incentive plan comply with the Administrative Measures, Trial Measures, Notice and other laws,
regulations, normative documents and the scope and conditions of incentive objects stipulated in
the Incentive Plan (Draft), and there is no circumstances that forbids to be incentive objects, and its
qualification as the incentive objects of this incentive plan is legal and effective.
On August 23, 2021, the Company disclosed the Independent Financial Advisor's Report of
CITIC Securities Co., Ltd. on the Restricted Stock Incentive Plan (Draft) in 2021 of Hangzhou
Steam Turbine Co., Ltd.
4. On August 27, 2021, the Company held the Second Provisional General Meeting of
Shareholders in 2021, which reviewed and approved the Proposal on the Company's Restricted
Stock Incentive Plan in 2021 and its Summary, the Proposal on the Company's Implementation
Assessment Management Measures for the Restricted Stock Incentive Plan in 2021, and the
Proposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors
to Handle Matters Related to the Restricted Stock Incentive Plan in 2021.
Meanwhile, the Company disclosed the Self-inspection Report on Insider Information of
Restricted Stock Incentive Plan in 2021 and Stock Trading of Incentive Objects.
5. On August 30, 2021, the Company convened the 16th Meeting of the Eighth Board of
Directors and the 11th Meeting of the Eighth Board of Supervisors, and respectively reviewed and
approved the Proposal on Granting Restricted Stocks to Incentive Objects for the First Time. The
Board of Directors of the Company considered that the granting conditions of restricted stocks
stipulated in this incentive plan had been fulfilled, and agreed to grant 18.17 million restricted
stocks to 457 incentive objects who meet the granting conditions on September 1, 2021 for the first
time, at a price of HKD 6.825 per share. The Board of Supervisors of the Company verified the list
of incentive objectives again and issued a clear consent opinion. Independent directors of the
Company expressed their agreed independent opinions on this.
6. On October 22, 2021, the Company completed the registration of granting restricted
shares for the first time, with 455 people registered for the first time and 18,060,000 shares
registered.
7. On December 16, 2021, the 20th Meeting of the 8th Board of Directors and the 13th
Meeting of 8th Board of Supervisors of the Company reviewed and approved the Proposal on
Granting Reserved Restricted Shares to Incentive Objects, It's agreed to grant 1,380,000 restricted
shares to 37 incentive objects who meet granting conditions on December 16,2021-which is the
pre-reserved stock grant date, with a grant price of HKD 6.825 per share. The Supervisory
Committee of the Company verified the list of incentive objects and issued a clear consent opinion.
Independent directors of the Company expressed in dependent opinions on relevant proposal of the
Board of Directors.
II.Specifics of the Grant of the Pre-reserved part of Restricted Stock
(I) Grant date: December 16,2021
（II) Source of stock: B common stock repurchased by the Company from the secondary
market
（III)Reserve grant quantity:1,380,000 million shares
(IV) Number of grant objects: 37 people
(V) Grant price: HKD 6.825/share（RMB 5.5660/shares, and the exchange rate of HKD to
RMB is 0.81553)
(VI).List of incentive objects and granting information
The distribution of restricted stocks granted by this incentive plan among the incentive objects is
shown in the following table:
Number of
Proportion of
restricted Proportion of share capital of
Name Position total grants the Company
stocks( Ten before grant
thousand shares)
Deputy Secretary of the
Party Committee and
Li Shijie 20 1.02% 0.03%
Chairman of the Trade
union
Middle management，6 58 2.97% 0.08%
Core personnel,，30 60 3.07% 0.08%
Total 138 7.06% 0.18%
Note: 1. The incentive objects of this incentive plan do not include independent directors, external
directors, supervisors, shareholders or actual controllers who individually or collectively hold more
than 5% of the Company's shares, and their spouses, parents and children;
2. The number of restricted shares granted to any incentive object in the incentive plan does
not exceed 1% of the total share capital of the company before the plan is submitted to the
shareholders' meeting for deliberation.
The above-mentioned incentive objects are all the personnel identified in the List of Incentive
Objects First Granted by Restricted Stock Incentive Plan in 2021 (at the Awarding Date) published
by the Company on Juchao Information Network on December 17, 2021.
（VII) Validity period of incentive plan, sales restriction period, arrangement for
lifting sales restriction and performance appraisal requirements
(1) Validity period of this incentive plan
The validity period of this incentive plan shall be from the date when the registration of
granting restricted stock is completed to the date when all restricted stocks granted to the incentive
object are released or repurchased, which shall be no more than 60 months.
(2) Sales restriction period of this incentive plan and arrangement for lifting the sales
restriction
The lifting period of restricted stock granted for the grant time in this incentive plan and the
schedule of each lifting period are shown in the following table:
Proportion of the number
Release arrangement of sales restriction that c
Release time of sales restriction
of sales restriction an be lifted to the numbe
r of authorized benefits
First From the first trading day 24 months after the completion of
Sales restriction release the grant registration to the last trading day within 36 months 33%
period after the completion of the grant registration
Second From the first trading day 36 months after the completion of
Sales restriction release the grant registration to the last trading day within 48 months 33%
period after the completion of the grant registration
Third From the first trading day 48 months after the completion of
Sales restriction release the grant registration to the last trading day within 60 months 34%
period after the completion of the grant registration
(3) Performance assessment requirements for lifting restrictions on the restricted stock sales
1. Performance assessment requirements at company level
For restricted stocks granted by this incentive plan, the assessment year for lifting the
restricted sales of this incentive plan is three fiscal years from 2021 to 2023, with one
assessment in each fiscal year. The performance assessment of lifting the restricted stock
granted by this plan is shown in the following table:
Sale
restriction Performance assessment conditions
period
Based on the average performance from 2018 to 2020, the growth rate of net profit attributable to
The first
ordinary shareholders of the company in 2021 is not lower than [12.0%], which is not lower than
sales
the average level of the same industry;
restriction
The return on net assets in 2021 is not lower than [8.0%], which is not lower than the average level
release
of the same industry;
period
In 2021, the profit of main business accounts for no less than [73%] of the total profit.
Based on the average performance from 2018 to 2020, the growth rate of net profit attributable to
The second
ordinary shareholders of the company in 2022 is not lower than [16.0%], which is not lower than
sales
the average level of the same industry;
restriction
The return on net assets in 2022 is not lower than [8.0%], which is not lower than the average level
release
of the same industry; In 2022, the profit of main business accounts for no less than [73%] of the
period
total profit.
Based on the average performance from 2018 to 2020, the growth rate of net profit attributable to
The third
ordinary shareholders of the company in 2023 is not lower than [20.0%], which is not lower than
sales
the average level of the same industry;
restriction
The return on net assets in 2023 is not lower than [8.0%], which is not lower than the average level
release
of the same industry;
period
In 2023, the profit of main business accounts for no less than [73%] of the total profit.
Note: ① The impact of other comprehensive income-changes in fair value of investment in
other equity instruments on changes in net assets is not considered when calculating the return on
net assets. ② When calculating the growth rate of net profit, the net profit attributable to the parent
company of the listed company after excluding the influence of share-based payment expenses of
this plan is the accounting standard. ③ Main business profit = total profit - investment income. ④
The specific accounting standard of performance indicators shall be determined by the Board of
Directors authorized by the General Meeting of Shareholders. ⑤ Within the validity period of the
equity incentive plan, if the net assets change due to additional issuance, share allotment, merger
and acquisition, etc., Where assessing the return on net assets index for the year, changes in net
assets and net profit changes caused by this event are excluded. ⑥ The Company is of the "General
Equipment Manufacturing Industry" under the "Manufacturing Industry" category of CSRC, and its
peer enterprises in the same industry are all domestic A-share and B-share listed companies under
the "General Equipment Manufacturing Industry" category of CSRC.
If the performance assessment target of the restricted stock in a certain period of the sales
restriction release period is not achieved, the restricted stock of all incentive objects in the current
period cannot be lifted, and the Company will repurchase the restricted stock at the granted price.
Assessment of incentive objects at individual level
Assessment of incentive objects at individual level shall be conducted in accordance
with the Administrative Measures for the Implementation Assessment of Restricted Stock
Incentive Plan of Hangzhou Steam Turbine Co., Ltd. in 2021.
Individual assessment of incentive objects is carried out by years, and performance
assessment results (S) are divided into four grades. The proportion of sales restriction
release in the current year is determined according to the results of individual
performance assessment. The actual sales restriction release amount of the individual in
the current year = the coefficient of sales restriction release × the planned sales
restriction release amount of the individual in the current year. The special circumstances
in performance assessment shall be decided by the Board of Directors. See the following
table for details:
Evaluation results
Excellent Good Pass Fail
(s)
Coefficient of sales
1 0.8 0
restriction release
Restricted stocks that cannot be released in the current period due to the results of performance
assessment at individual level shall not be deferred until the sales restriction release in the next
period, and shall be repurchased by the Company at the granted price.
III. Explanation on the consistency between the granting of restricted stock to the
incentive objects granted this time and the previous review by the Board of Directors
At the 20th meeting of the eighth meeting of the Company's board of directors, it reviewed
and approved the "Proposal on Granting some Pre-reserved Restricted stocks to Incentive
Object". It's agreed to grant 1.380 million restricted shares to 37 incentive objects who meet the
granting conditions on December 16, 2021-which is the pre-reserved stock grant date, with a
grant price of HKD 6.825 per share. The granting of restricted stocks to incentive objects this
time is consistent with the deliberation of the board of directors.
IV. Capital verification of restricted stock subscription funds
Pan-China Certified Public Accountants (special general partnership) issued the Capital
Verification Report of Hangzhou Steam Turbine Co., Ltd (TJY [2021] No.782) on December 22,
2021, which was verified as follows:
As of December 21, 2021, the Company has received paid-in capital of RMB 7,681,069.47 in
its account established in China CITIC Bank Hushu Sub-branch for restricted stock incentive plan
(account No.: 7332810182600019959). Participants in the restricted stock incentive plan of the
Company acquired and held 1,380,000 shares of the Company by repurchasing shares through your
special securities account. After the repurchase of the restricted stock incentive plan, the Company's
treasury shares will be reduced by 1,380,000 shares, Together with the first restricted stock
incentive plan repurchase, a total of 19.44 million treasury shares will be reduced, remaining
111,800 shares.
V. Listing date of restricted stock
The grant date of this restricted stock incentive plan is December 16, 2021, and the listing
date of restricted stocks is January 14, 2022.
VI. Influence of restricted stock grant registration on actual controller and
controlling shareholders of the Company
After the registration of the granting of restricted stock, the total capital stock of the Company
is still 754,010,400 shares, and the actual controllers, controlling shareholders and their persons
acting in concert still hold 479,824,800 shares, accounting for the same proportion of the
Company's capital stock. The source of the shares granted this time is the B common stock
repurchased by the Company through the secondary market, and the total capital stock of the
Company has not changed. This grant will not cause any change in the actual controller and
controlling shareholder of the Company.
VII. Changes in the Company's capital stock structure
After the registration of this restricted stock grant, the changes of the Company's capital stock
structure are shown in the following table:
Before this change Increase/decrease After this change
Nature of stock quantity (shares)
Quantity Proportion in this change Quantity Proportion
(shares) Quantity (shares) (shares)
I. Unlisted tradable
479,824,800 63.64% 479,824,800 63.64%
shares
II. Listed tradable
274,185,600 36.36% 274,185,600 36.36%
shares
1. Restricted tradable
18,060,000 2.40% 1,380,000 19,440,000 2.58%
shares
2. Unlimited tradable
256,125,600 33.97% -1,380,000 254,745,600 33.79%
shares
III. Total capital stock 754,010,400 100.00% 754,010,400 100.00%
Note: After the granting of restricted stock, the Company's equity distribution still meets the listing
requirements.
VIII. Dilution of earnings per share
Since the restricted stock granted this time is from the B common stock repurchased by the
Company itself from the secondary market, the total number of shares of the Company will remain
unchanged after the grant is completed. Therefore, there is no dilution of earnings per share.
IX. Description of the Company's repurchased shares for this incentive plan
1. Implementation of share repurchase
On December 10, 2019, the Company held the second Provisional general meeting of
shareholders in 2019, which reviewed and approved the share repurchase plan, and disclosed the
share repurchase report on December 21, 2019 (see the Company's announcement for details,
Announcement No.: 2019-79). On December 2, 2020, the Company disclosed the Announcement on
the Implementation Results of Share Repurchase and Share Changes. By November 30, 2020, the
Company had completed repurchase, and actually repurchased 19,551,800 shares of the Company,
accounting for 2.59% of the Company's total share capital. The highest repurchase price was HKD
9.17 per share, the lowest repurchase price was HKD 7.22 per share, and the total amount of funds
used was HKD 160,734,718.28. All the above repurchased shares are used to implement the equity
incentive plan, which is consistent with the proposed purpose of the Company's share repurchase
plan.
2. Explanation on accounting treatment of difference between award price of incentive shares
and average price of repurchased shares
According to Article 22 of Accounting Standards for Business Enterprises No.37-Presentation
of Financial Instruments, if a financial instrument or its components are equity instruments, when it
is issued (including refinanced), repurchased, sold or canceled, the issuer shall treat it as a change in
equity. Meanwhile, according to the regulation of employee option incentive for repurchased shares
in the application guide of Accounting Standards for Business Enterprises No.11-Share Payment, an
enterprise should write off the cost of treasury shares delivered to employees when employees are
entitled to feasible rights, and adjust the capital reserve according to the difference. On each balance
sheet date of the waiting period, the Company will include the difference between the fair value of
the restricted stock grant date and the employee subscription price in the cost, and increase the
capital reserve (other capital reserve).
X. A description of the sales of the Company's shares during the 6 months before the
grant date of restricted stock if the incentive objects are directors and senior management
personnel
After self-examination by the Company, the directors and senior management personnel who
participated in the incentive did not buy or sell the Company's stock during 6 months before the
grant date.
XI. Use plan of funds raised by granting restricted stock this time
The funds raised by granting restricted stock to the incentive object(s) this time will be used to
supplement the working capital of the Company.
8
This announcement is hereby made.
Hangzhou Steam Turbine Co., Ltd.
January 17, 2022
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