Adjusting Repurchase Prices of Incentive Scheme

Ming Yang Smart Energy Group Ltd

18 July 2023

 

MING YANG SMART ENERGY GROUP LIMITED

(GDR under the symbol: "MYSE")

(a joint stock company established under the laws of the People's Republic of China with limited liability)

Announcement on Adjusting the Repurchase Prices of the First Grant and the Reserved Portion under the 2019 Restricted Share Incentive Scheme

Ming Yang Smart Energy Group Limited (hereinafter referred to as "Ming Yang Smart" or the "Company") held the 40th meeting of the second Board and the 35th meeting of the second Supervisory Committee on 18 July 2023, at which the Resolution Regarding Adjustment in the Repurchase Prices of the First Grant and the Reserved Portion under the 2019 Restricted Share Incentive Scheme was considered and approved. Pursuant to the authorisation of the 2019 annual general meeting of the Company, the repurchase prices of the first grant and the reserved portion under the 2019 restricted share incentive scheme of the Company ("2019 Restricted Share Incentive Scheme") were adjusted. The relevant issues are stated as follows:

I. Decision-making procedures performed and information disclosure

1. On 26 August 2019, the Company held the 25th meeting of the first Board and the 18th meeting of the first Supervisory Committee, at which the 2019 Restricted Share Incentive Scheme (Draft) and Summary, the Administrative Measures for the Evaluation of the Implementation of the 2019 Restricted Share Incentive Scheme and other resolutions were considered and approved. The Supervisory Committee verified the incentive participants of the incentive scheme and issued verification opinions. 

2. On 20 April 2020, the Company held the third meeting of the second Board and the third meeting of the second Supervisory Committee, at which the 2019 Restricted Share Incentive Scheme (Revised draft) and Summary, the Resolution Regarding Requesting the General Meeting to Authorize the Board to Deal with Matters Related to the Restricted Share Incentive Scheme of the Company and other resolutions were considered and approved. The Supervisory Committee verified the incentive participants of the incentive scheme and issued verification opinions.

3. From 22 April 2020 to 2 May 2020, the Company conducted internal public disclosures of the names and positions of the proposed incentive participants. After the expiry of the public notice period, the Supervisory Committee verified the list of the incentive participants for the initial grant of the incentive scheme and provided an explanation of the information.

4. On 13 May 2020, the Company held the 2019 annual general meeting, at which the 2019 Restricted Share Incentive Scheme (Revised draft) and Summary, the Resolution Regarding Requesting the General Meeting to Authorize the Board to Deal with Matters Related to the Restricted Share Incentive Scheme of the Company, the Administrative Measures for the Evaluation of the Implementation of the 2019 Restricted Share Incentive Scheme and other resolutions were considered and approved. The Company conducted self-inspection on the trading of the shares of the Company by insiders of the share incentive scheme, and the Company did not find any insider trading of the shares of the Company using insider information.

5. On 20 May 2020, the Company held the fifth meeting of the second Board and the fifth meeting of the second Supervisory Committee, at which the Resolution Regarding the Issues Related to the Adjustment in the 2019 Restricted Share Incentive Scheme, the Resolution Regarding the Grant of Restricted Shares to Incentive Participants Under the First Grant and other resolutions were considered and approved. Independent Directors of the Company expressed their independent opinions in this regard, and they are of the view that the qualifications of the incentive participants are legal and valid. The determined Grant Date complies with the relevant requirements. The Supervisory Committee verified the incentive participants of the incentive scheme and issued verification opinions.

6. On 7 July 2020, the Company initially granted an aggregate of 23.3404 million shares to 220 incentive participants and completed the registration at the Shanghai Branch of China Securities Depository and Clearing Corporation Limited (hereinafter referred to as the "CSDCC").

7. On 12 May 2021, the Company held the 20th meeting of the second Board and the 16th meeting of the second Supervisory Committee, at which the Resolution Regarding the Grant of Reserved Restricted Shares to Incentive Participants Under the 2019 Restricted Share Incentive Scheme was considered and approved. The Supervisory Committee verified the incentive participants of the reserved portion.

8. From 15 May 2021 to 24 May 2021, the Company conducted internal public disclosures of the names and positions of the proposed incentive participants for the reserved portion. After the expiry of the public notice period, the Supervisory Committee verified the list of the incentive participants for the reserved portion to be granted to them and made public disclosures.

9. On 9 June 2021, the Company held the 21st meeting of the second Board and the 17th meeting of the second Supervisory Committee, at which the Resolution Regarding the Adjustment in the Grant Price of the Reserved Portion Under the 2019 Restricted Share Incentive Scheme and the Repurchase Price of the Some Shares Under the First Grant, the Resolution Regarding the Repurchase and Cancellation of the Restricted Shares Granted to the Incentive Participants but Remaining Locked-up and the Resolution Regarding the Fulfilment of the Unlocking Conditions for the First Unlocking Period for the First Grant Under the 2019 Restricted Share Incentive Scheme were considered and approved, agreeing (1) the grant price of the reserved portion under the 2019 Restricted Share Incentive Scheme was adjusted from RMB8.39 per share to RMB8.284 per share, and the repurchase price of the shares under the first grant was adjusted from RMB5.222 per share to RMB5.116 per share; (2) the annual general meeting agreed to repurchase and cancel the 100,000 restricted shares granted but remaining unlocked held by three incentive participants who have left office, and such shares were cancelled on 10 August 2021; and (3) the annual general meeting completed the relevant procedures for unlocking a total of 5,810,100 restricted shares held by 217 incentive participants meeting the unlocking conditions, and such shares became tradable on 9 July 2021.

10. On 17 September 2021, the Company granted a total of 5,498,000 reserved shares of the restricted shares to 103 incentive participants at the grant price of RMB8.284 per share and completed the registration procedures with CSDCC.

11. On 21 February 2022, the Company held the 28th meeting of the second Board and the 24th meeting of the second Supervisory Committee, at which the Resolution Regarding the Repurchase and Cancellation of the Restricted Shares Granted to Certain Incentive Participants but Remaining Locked-up Under the 2019 Restricted Share Incentive Scheme was considered and approved, agreeing to repurchase and cancel the 472,500 restricted shares granted but remaining unlocked held by eight incentive participants who have left office. Such shares were cancelled on 23 May 2022.

12. On 28 June 2022, the Company held the 32nd meeting of the second Board and the 28th meeting of the second Supervisory Committee, at which the Resolution Regarding the Adjustment in the Repurchase Price of the Shares Under the First Grant and the Repurchase Price of the Reserved Portion under the 2019 Restricted Share Incentive Scheme and the Resolution Regarding the Fulfilment of the Unlocking Conditions for the Second Unlocking Period for the First Grant Under the 2019 Restricted Share Incentive Scheme were considered and approved, agreeing (1) the repurchase price of the shares under the first grant under the 2019 Restricted Share Incentive Scheme was adjusted from RMB5.116 per share to RMB4.895 per share, and the repurchase price of the reserved portion was adjusted from RMB8.284 per share to RMB8.063 per share; and (2) the annual general meeting agreed to complete the relevant procedures for unlocking a total of 5,667,600 restricted shares held by 211 incentive participants meeting the unlocking conditions. Such shares became tradable on 7 July 2022.

13. On 10 November 2022, the Company held the 35th meeting of the second Board and the 31st meeting of the second Supervisory Committee, at which the Resolution Regarding the Fulfilment of the Unlocking Conditions for the First Unlocking Period for the Reserved Portion Under the 2019 Restricted Share Incentive Scheme was considered and approved, agreeing to complete the relevant procedures for unlocking a total of 1,628,400 restricted shares held by 100 incentive participants meeting the unlocking conditions. Such shares became tradable on 23 November 2022.

14. On 17 March 2023, the Company held the 37th meeting of the second Board and the 32nd meeting of the second Supervisory Committee, at which the Resolution Regarding the Repurchase and Cancellation of the Restricted Shares Granted to Certain Incentive Participants but Remaining Locked-up Under the 2019 Restricted Share Incentive Scheme was considered and approved. As authorised by the 2019 annual general meeting of the Company, the annual general meeting agreed to repurchase and cancel the 102,000 restricted shares granted but remaining unlocked held by six incentive participants who have left office. Such shares were cancelled on 22 May 2023.

15. On 18 July 2023, the Company held the 40th meeting of the second Board and the 35th meeting of the second Supervisory Committee, at which the Resolution Regarding Adjustment in the Repurchase Prices of the First Grant and the Reserved Portion under the 2019 Restricted Share Incentive Scheme was considered and approved, agreeing to adjust the purchase price of the first grant under the 2019 Restricted Share Incentive Scheme from RMB4.895 per share to RMB4.591 per share, and adjust the repurchase price of the reserved portion from RMB8.063 per share to RMB7.759 per share.

Independent Directors expressed their independent consent opinions for the above related matters, and Beijing Tian Yuan Law Firm issued a legal opinion accordingly.

In summary, the Company's 2019 Restricted Share Incentive Scheme has fulfilled the relevant approval procedures. For details, please refer to the relevant announcements and documents disclosed by the Company on the designated information disclosure media.

II. Description for the adjustment

Pursuant to the Resolution Regarding the Profit Distribution Plan for 2022 considered and approved at the 2022 general meeting of the Company, the Company completed the equity distribution on 14 June 2023, namely a cash dividend of RMB3.0410 (tax inclusive) was distributed to all shareholders for every 10 shares, and an aggregate cash dividend of RMB 690,910,245.00 (tax inclusive) was distributed.

According to the relevant requirements of the Administrative Measures on Equity Incentives of Listed Companies and the 2019 Restricted Share Incentive Scheme (Revised draft) of the Company, after the completion of registration of the restricted shares granted to the incentive participants, if there are conversions of capital reserve into share capital, distributions of dividends, stock splits, allotments of shares, reductions of shares and other activities affecting the total share capital or share price of the Company, the Company shall make corresponding adjustments to the repurchase prices of the restricted shares which have not been unlocked.

1.     The adjustment in the repurchase price of the first grant is set out below:

The adjusted repurchase price for the restricted shares of the first grant is: P＝P0-V=RMB4.895 per share - RMB0.3041 per share ≈ RMB4.591per share, of which P0 represents the pre-adjusted repurchase price for the restricted shares per share; V represents the dividend payment amount per share; and P represents the adjusted repurchase price for the restricted shares per share.

2.     The adjustment in the repurchase price of the reserved portion is set out below:

The adjusted repurchase price for the restricted shares of the reserved portion is: P＝P0-V=RMB8.063 per share - RMB0.3041 per share ≈ RMB7.759 per share, of which P0 represents the pre-adjusted repurchase price for the restricted shares per share; V represents the dividend payment amount per share; and P represents the adjusted repurchase price for the restricted shares per share.

In addition to the above adjustments, other contents of the Restricted Share Incentive Scheme implemented this time are consistent with the incentive scheme considered and approved at the 2019 annual general meeting of the Company. Pursuant to the authorisation of the 2019 annual general meeting of the Company, the adjustment is not required to be submitted to the general meeting for consideration.

III. The adjustment's effects on the Company

The adjustment of the relevant matters in the Restricted Share Incentive Schem is in compliance with the relevant requirements of the Administrative Measures on Equity Incentives of Listed Companies and the 2019 Restricted Share Incentive Scheme (Revised draft), and is consistent with the actual situation of the Company and will not have material effects on the financial conditions and operation results of the Company.

IV. Opinions of Independent Directors

As considered, independent directors are of the view that the Board's approval of the adjustment in the repurchase prices of the first grant and the reserved portion under the 2019 Restricted Share Incentive Scheme is in compliance with the laws, regulations and normative documents such as the Administrative Measures on Equity Incentives of Listed Companies and the relevant requirements of the 2019 Restricted Share Incentive Scheme (Revised draft). The adjustment is within the scope of authority of the Board at the 2019 annual general meeting of the Company, and the procedures for the adjustment are in compliance the laws and regulations and there are no circumstances where the interests of the Company and all of its shareholders will be damaged; they agreed the Board to adjust the repurchase prices of the first grant and the reserved portion under the 2019 Restricted Share Incentive Scheme to RMB4.591 per share and RMB7.759 per share, respectively.

V. Opinions of the Supervisory Committee

As considered, the Supervisory Committee is of the view that the adjustment in the repurchase prices of the first grant and the reserved portion under the Restricted Share Incentive Scheme is in compliance with the relevant laws and regulations such as the Administrative Measures on Equity Incentives of Listed Companies and there are no circumstances where the interests of the Company and all of its shareholders will be damaged. We agreed on the adjustment in the repurchase prices of the first grant and the reserved portion under the Restricted Share Incentive Scheme.

VI. Conclusion on the Legal Opinion

Beijing Tian Yuan Law Firm has issued a legal opinion on the adjustment in the repurchase prices of the first grant and the reserved portion under the 2019 Restricted Share Incentive Scheme and the law firm is of the opinion that: the approval and authorisation procedures went through by Ming Yang Smart in respect of the Share Incentive Scheme are in compliance with the relevant laws, regulations and normative documents such as the Company Law, the Securities Law, the Administrative Measures and the relevant requirements of the Incentive Scheme (Revised draft); the necessary approvals and authorisations have been obtained for the adjustment in the repurchase prices of the first grant and the reserved portion; the reasons for the adjustment in the repurchase prices of the first grant and the reserved portion and the adjusted prices are in compliance with the requirements of the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Administrative Measures and other laws, regulations and normative documents and the requirements of the Incentive Scheme (Revised draft).

.

Ming Yang Smart Energy Group Limited

18 July, 2023

 

END