Chapter 1 Definitions
In this independent financial advisor report, unless otherwise specified, the following terms have the meanings ascribed to them:
| Term | Definition |
|---|---|
| Hengmingda, listed company, company, this company | Refers to Suzhou Hengmingda Electronics Technology Co., Ltd. |
| This incentive plan | Refers to the 2026 stock option incentive plan of Suzhou Hengmingda Electronics Technology Co., Ltd. |
| This independent financial advisor report | Refers to the "Independent Financial Advisor Report on Suzhou Hengmingda Electronics Technology Co., Ltd.'s 2026 Stock Option Incentive Plan (Draft)" by Dongfang Caifu Securities Co., Ltd. |
| Independent financial advisor, this independent financial advisor | Refers to Dongfang Caifu Securities Co., Ltd. |
| Stock options | The rights granted to incentive objects to purchase a certain number of shares of the company at a predetermined price within a specified period. |
| Incentive objects | Directors, senior management, and core employees of the company (including subsidiaries) who are granted stock options according to this incentive plan. |
| Authorization date | The date on which the company grants stock options to the incentive objects, which must be a trading day. |
| Exercise price | The price determined by the company at which the incentive objects can purchase shares of the listed company. |
| Validity period | The period from the authorization date of the stock options until all granted stock options are exercised or canceled. |
| Waiting period | The time period from the completion of the stock option authorization registration to the date when the stock options can be exercised. |
| Exercise | The act of the incentive objects exercising their stock options to purchase company shares according to the incentive plan. |
| Exercise date | The date on which the incentive objects can begin to exercise their options, which must be a trading day. |
| Exercise conditions | The conditions that must be met for the incentive objects to exercise their stock options according to this incentive plan. |
| Compensation committee | The company's board of directors' compensation and assessment committee. |
| CSRC | China Securities Regulatory Commission. |
| Stock exchange | Shenzhen Stock Exchange. |
| Company Law | Company Law of the People's Republic of China. |
| Securities Law | Securities Law of the People's Republic of China. |
| Management Measures | Management Measures for Equity Incentives of Listed Companies. |
| Self-regulatory Guidelines | Self-regulatory Guidelines No. 1 for Business Handling of Listed Companies on the Shenzhen Stock Exchange. |
| Articles of Association | Articles of Association of Suzhou Hengmingda Electronics Technology Co., Ltd. |
| Company Assessment Management Measures | Implementation Assessment Management Measures for the 2026 Stock Option Incentive Plan of Suzhou Hengmingda Electronics Technology Co., Ltd. |
| Yuan | Renminbi, the legal currency unit of the People's Republic of China. |
Chapter 2 Statement
Dongfang Caifu Securities Co., Ltd. has been entrusted to act as the independent financial advisor for Suzhou Hengmingda Electronics Technology Co., Ltd.'s 2026 stock option incentive plan and to prepare this independent financial advisor report. This independent financial advisor report is based on the relevant provisions of the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Management Measures for Equity Incentives of Listed Companies, and other laws, regulations, and normative documents, and is issued based on the information provided by Hengmingda for reference by all shareholders and relevant parties.