| Time: July 30, 2024, 17:51:16 Zhongcai Network |
Original Title: Liding Optoelectronics: Fujian Zhili Law Firm’s Legal Opinion on the Release of Restricted Stock Incentive Plan for Xiamen Liding Optoelectronic Co., Ltd. Regarding the First Grant of the 2021 Restricted Stock Incentive Plan’s Third Phase and the Release of the Second Phase of the Reserved Grant
About Xiamen Liding Optoelectronics Co., Ltd.
Legal Opinion on the Release of the Third Phase of the First Grant and the Second Phase of the Reserved Grant of the 2021 Restricted Stock Incentive Plan
Address: 22nd Floor, CR Vanguard Mall Phase III, Hongshan Garden Road, Gulou District, Fuzhou, Zip Code: 350025, Phone: (86 591) 8806 5558, Website: Fujian Zhili Law Firm
About Xiamen Liding Optoelectronics Co., Ltd.
Legal Opinion on the Release of the Third Phase of the First Grant and
the Release of the Second Phase of the Reserved Grant of the
2021 Restricted Stock Incentive Plan
Minli No. [2024] 2021103-14
To: Xiamen Liding Optoelectronics Co., Ltd.
Fujian Zhili Law Firm (hereinafter referred to as “this firm”) has been legally entrusted by Xiamen Liding Optoelectronics Co., Ltd. (hereinafter referred to as “Liding Optoelectronics” or “the Company”) to act as the special legal advisor for the implementation of the 2021 Restricted Stock Incentive Plan (hereinafter referred to as “this incentive plan”). In accordance with the provisions of the Securities Law of the People’s Republic of China (hereinafter referred to as “Securities Law”), the Company Law of the People’s Republic of China (hereinafter referred to as “Company Law”), and the Measures for the Administration of Equity Incentives of Listed Companies issued by the China Securities Regulatory Commission (CSRC Order No. 148, hereinafter referred to as “Management Measures”), as well as relevant laws, regulations, and normative documents, following the recognized operational standards, ethical norms, and diligent responsibility principles of the legal profession, our firm hereby issues this legal opinion regarding the release of restrictions for the third phase of the first grant and the second phase of the reserved grant (hereinafter referred to as “this release of restriction”).
Regarding this legal opinion, our firm makes the following declarations:
1. Our firm and the responsible lawyers have strictly fulfilled their statutory duties and have adhered to the principles of diligence and honesty based on the provisions of the Securities Law, the Management Measures for Law Firms Engaging in Securities Legal Services, and other current legal, regulatory, and normative documents before the issuance date of this legal opinion. We have conducted thorough verification and guarantee that the facts determined in this legal opinion are true, accurate, and complete, and that the conclusions drawn are legal and accurate, free from false records, misleading statements, or significant omissions.
2. Our lawyers agree to consider this legal opinion as one of the necessary legal documents for the Company’s incentive plan, to be publicly disclosed together with other materials, and are willing to undertake corresponding legal responsibilities in accordance with the law.
3. Our lawyers do not comment on matters outside the realm of legal expertise, such as accounting, auditing, capital verification, profit forecasts and reviews, asset evaluations, etc. When referencing data or conclusions from accounting statements, audit reports, capital verification reports, profit forecast reports, profit forecast review reports, and asset evaluation reports in this legal opinion, it does not imply that our lawyers provide any express or implied guarantees regarding the truthfulness and accuracy of these data or conclusions.
4. The Company guarantees it has provided truthful original written materials, copies, or oral testimonies that our lawyers deemed necessary for issuing this legal opinion, ensuring that signatures and/or seals on relevant materials are authentic and valid, and that all copies, photocopies are consistent with original materials without concealment, false records, misleading statements, or significant omissions.
5. For facts crucial to this legal opinion but lacking independent evidence support, our lawyers rely on certification documents issued by government departments and other organizations, as well as statements and commitments from relevant parties involved in this incentive plan regarding pertinent facts and legal issues.
6. This legal opinion is only for the purpose of the Company’s incentive plan and shall not be used for any other purpose.
Based on the above declarations, our firm issues the following legal opinion:
1. The decision-making procedure for this release of restriction
(1) On June 11, 2021, the Company held the second meeting of the second board of directors, where it reviewed and approved the proposal regarding the relevant matters of the incentive plan at the shareholders’ meeting.
On July 26, 2021, the Company held the first temporary shareholders meeting of 2021, where the above proposals were reviewed and approved, authorizing the board of directors to specifically implement this incentive plan and manage matters such as the release of restrictions on restricted stocks and repurchasing and canceling the restricted stocks of incentive objects that have not yet had restrictions lifted.
(2) On July 26, 2021, based on the authorization of the shareholders’ meeting, the Company held the third meeting of the second board of directors, where it reviewed and approved proposals to adjust the list of incentive targets for the first grant of the 2021 restricted stock incentive plan and other proposals, determining the grant date, incentive objects, and the number of shares for the first grant of the restricted stocks.
(3) On June 30, 2022, based on the authorization of the shareholders’ meeting, the Company held the twelfth meeting of the second board of directors, where it reviewed and approved the proposal to grant reserved restricted stocks to incentive objects, determining the grant date, incentive objects, and the number of shares for the reserved part of the restricted stocks.
(4) On July 30, 2024, the Company held the third meeting of the third board of directors, where it reviewed and approved the proposal regarding the conditions of the third restriction period and the second restriction period for the reserved grant of the 2021 restricted stock incentive plan, confirming the conditions for the release of restrictions for the third restriction phase of the first grant and second restriction phase of the reserved grant have been fulfilled and agreeing to release restrictions concerning 445,750 shares of restricted stock for 121 eligible incentive participants. Among them, 119 participants for the third phase of the first grant are eligible with a total of 420,750 shares, and 2 participants for the second phase of the reserved grant are eligible with 25,000 shares.
(5) On July 30, 2024, the Company held the second meeting of the third supervisory board, where it reviewed and approved the proposal related to the accomplishment of the conditions for the release of restrictions for the third limit period of the first grant and the second limit period of the reserved grant under the 2021 restricted stock incentive plan.
Upon verification, our lawyers believe that the notifications, convening methods, voting procedures, and voting methods for the aforementioned board of directors, supervisory board, and shareholders’ meetings comply with the provisions of the Company Law and the Company’s Articles of Association. The release of restrictions has completed the necessary authorization and approval procedures by the issuance date of this legal opinion, in conformity with the Management Measures and other applicable regulations as well as the arrangements stipulated in the “2021 Restricted Stock Incentive Plan” of Xiamen Liding Optoelectronics Co., Ltd. (hereinafter referred to as “Incentive Plan”).
2. Conditions for the release of restrictions
(1) The conditions for the release of restrictions have been met
After our lawyers’ examination, the conditions for releasing restrictions for both the third restriction period of the first grant and the second restriction period of the reserved grant of restricted stocks have been satisfied, as detailed below:
| Assessment Score (X) |
X≥80 | 80＞X ≥70 |
70＞X ≥60 |
X＜60 |
| Assessment Result |
Excellent | Good | Pass | Fail |
| Percentage of Release (M) |
100% | 80% | 70% | 0 |
(2) Quantity of the release of restrictions
As confirmed by our lawyers, as of the date of issuance of this legal opinion, the eligible incentive candidates for the third release of restrictions of the first grant of restricted stocks number 119, with a release ratio of 30% for the third restriction phase, meaning that the number of restricted shares released from this first grant amounts to 420,750 shares, representing 0.1033% of the Company’s current total share capital; for the second restriction phase of the reserved grants, there are 2 eligible incentive candidates, where the reserved portion of the restricted stocks, which was granted in 2022, the release ratio for the second restriction phase of the reserved stock matches 50%, meaning that 25,000 shares corresponding to this reserved grant can be released, accounting for 0.0061% of the Company’s total share capital.
(3) Timing of the release of restrictions
According to the “Incentive Plan,” the timing for the release of restrictions for the third restriction phase of the first grant and the second restriction phase for the reserved grant of restricted stocks is arranged as follows:
| Release Timing |
| From the first granting date of the restricted stocks for the first grant, from the 36th month to the last trading day within 48 months from the granting date |
| From the granting date of the reserved restricted stocks, from the 24th month to the last trading day within 36 months from the granting date of the first grant |
Based on the Company’s “Announcement of the First Grant Results of the 2021 Restricted Stock Incentive Plan” (Announcement No.: 2021-043), the first grant day of this incentive plan is July 26, 2021. The third phase of the first grant’s restricted stocks will enter the second release period starting from July 26, 2024. According to the Company’s “Announcement of the Reserved Equity Grant Results of 2021 Restricted Stock Incentive Plan” (Announcement No.: 2022-042), the reserved grant was on June 30, 2022, with its second release phase starting from July 1, 2024.
In summary, our lawyers believe that the conditions for releasing restrictions have been fulfilled for both the third restriction period of the first grant and the second restriction phase of the reserved grant in the Company’s incentive plan, and that this release of restrictions is in accordance with the Management Measures and other applicable laws, regulations, normative documents, as well as the provisions of the Incentive Plan. The Company shall handle the release of restrictions for this batch of restricted stocks in accordance with the provisions of the Incentive Plan after the expiration of the restriction period.
4. Conclusion
In conclusion, our lawyers believe that the conditions for releasing restrictions have been met for both the third restriction phase of the first grant of restricted stocks and the second restriction phase of the reserved grants, and that this release of restrictions complies with the requirements of the Measures for the Administration of Equity Incentives of Listed Companies and other relevant laws, regulations, and normative documents, as well as the arrangements stipulated in the “2021 Restricted Stock Incentive Plan” of Xiamen Liding Optoelectronics Co., Ltd.. The necessary decision-making procedures have been fulfilled prior to the issuance date of this legal opinion. The release of restrictions also needs to comply with requirements on information disclosure, registration, and settlement based on the provisions of the Management Measures and other relevant laws, regulations, and normative documents.
This legal opinion shall take effect upon the signature of the responsible personnel and the handling lawyer after affixing the official seal of the firm. The original of this legal opinion is issued in three copies, and duplicates are also issued, all of which have the same legal effect.
Sincerely,
Zhongcai Network
