Chapter 1 General Principles
Article 1
To standardize the compensation management of directors and senior management at Suzhou Shiming Technology Co., Ltd. (hereinafter referred to as "the Company"), establish a scientific and effective incentive and restraint mechanism, and better motivate the work enthusiasm of the Company's directors and senior management, thereby enhancing the operational management efficiency of the Company, this system is formulated based on the "Company Law of the People's Republic of China" (hereinafter referred to as "the Company Law"), "Self-Regulatory Guidelines No. 2 for Listed Companies on the Shenzhen Stock Exchange - Standardized Operations of Growth Enterprise Market Listed Companies," and other relevant laws, administrative regulations, departmental rules, normative documents, as well as the "Articles of Association" and "Implementation Rules of the Compensation and Assessment Committee," combined with the actual situation of the Company.
Article 2
The term "directors" in this system refers to all current members of the Company's board of directors during the implementation of this system. The board consists of internal non-independent directors (hereinafter referred to as "internal directors"), external non-independent directors (also known as "full-time external directors"), and independent directors.
- Internal directors: Non-independent directors who are senior management personnel or other employees of the Company with an employment or labor contract.
- Full-time external directors: Non-independent directors who do not hold any other positions in the Company besides being a director.
- Independent directors: Directors appointed by the Company in accordance with the "Management Measures for Independent Directors of Listed Companies," who have no relationships with the Company or its major shareholders that may hinder their independent and objective judgment.
Article 3
The term "senior management" in this system refers to the president, vice presidents, financial director, board secretary, and other senior management personnel as stipulated in the Company's Articles of Association, appointed by the board of directors.
Article 4
The term "compensation management" in this system refers to the specific activities of standardized management of the compensation and benefits of directors and senior management, including compensation composition, management, and supervision.
Article 5
This system applies to the directors and senior management as stipulated in the Articles of Association.
Article 6
The compensation system for the Company's directors and senior management follows the principles below:
- Fairness, justice, and transparency: Compensation levels should align with the Company's scale and performance.
- Competitiveness: Compensation should be competitive compared to similar positions in the market.
- Unity of responsibility, authority, and benefits: Compensation should correspond to the value of the position and the responsibilities undertaken.
- Long-term development: Compensation should align with the goals of the Company's sustainable and healthy development.
- Balance of incentives and constraints: Compensation distribution should be linked to assessments, rewards, and penalties.