Chapter 1 General Provisions
Article 1 To further improve the compensation management system for directors and senior management of Luo Lai Life Technology Co., Ltd. (hereinafter referred to as the "Company"), establish and improve the incentive and restraint mechanism for operators, maintain the stability of the core management team, effectively mobilize the work enthusiasm of directors and senior management, and improve the company's management level, promote the healthy, sustained, and stable development of the company, in accordance with the "Company Law of the People's Republic of China," the "Main Board Listing Rules of the Shenzhen Stock Exchange," the "Shenzhen Stock Exchange Listed Company Self-Regulation Guidelines No. 1 - Standardized Operation of Main Board Listed Companies," and other relevant laws and regulations, as well as the "Articles of Association of Luo Lai Life Technology Co., Ltd." and the "Articles of Association of the Board of Directors' Compensation and Assessment Committee," and in combination with the company's actual situation, this system is hereby formulated.
Article 2 This system applies to the directors and senior management of the Company. Senior management refers to the Company's President, Vice Presidents, Board Secretary, Chief Financial Officer, and other senior management personnel.
Article 3 The compensation of directors and senior management of the Company shall be commensurate with market development, matched with the Company's operating performance and individual performance, and coordinated with the Company's sustainable development. The Company shall reasonably determine the compensation distribution ratio among directors, senior management, and ordinary employees by considering factors such as industry level, development strategy, and position value, so as to tilt compensation towards key positions, sales, and urgently needed high-level, high-skilled talents, and promote the improvement of ordinary employees' compensation level. The Company's compensation system follows the following principles: (1) The compensation of each position in the Company shall reflect the value of the position and its grade to the Company, embodying the principle of consistency between responsibilities, rights, contributions, and benefits; (2) The principle of linking compensation levels to the Company's goals and benefits; (3) The principle of adhering to performance appraisal standards and process systems; (4) The principle of balancing incentives and constraints, and equal rewards and punishments.
Chapter 2 Compensation Management Organization
Article 4 The Company's Board of Directors shall review the compensation of senior management, report to the Shareholders' Meeting, and disclose it fully; the Company's Shareholders' Meeting shall review the compensation of directors and disclose it.
Article 5 Under the authorization of the Board of Directors, the Compensation and Assessment Committee of the Board of Directors of the Company is responsible for formulating the compensation plan for the Company's directors and senior management, clarifying the basis and specific composition of compensation determination; responsible for reviewing the performance of directors and senior management and conducting annual performance and performance evaluations; responsible for supervising the implementation of the Company's compensation system. When the Board of Directors or the Compensation and Assessment Committee evaluates or discusses the remuneration of a director, that director shall recuse himself.