Chapter 1 General Principles
Article 1
To further improve the management level of Yantai Zhenghai Biotechnology Co., Ltd. (hereinafter referred to as "the Company"), fully motivate senior executives, establish an incentive and restraint mechanism compatible with modern enterprise systems, maintain the stability of the core management team, and create greater benefits for the Company and its shareholders, this system is formulated based on the principles of responsibility, authority, and benefits, in accordance with the Company Law, the Guidelines for Corporate Governance of Listed Companies, and the relevant provisions of the Articles of Association, while fully considering the actual situation of the Company and industry characteristics.
Article 2
The term "senior executives" in this system refers to the General Manager, Deputy General Managers, Board Secretary, Chief Financial Officer, and other senior executives recognized by the Articles of Association.
Article 3
The determination of annual compensation for senior executives follows these principles:
- Responsibility Principle: The basic salary standard is determined based on job position, work performance, contribution size, and the combination of responsibility, authority, and benefits.
- Performance Principle: Performance compensation is linked to the completion of individual job responsibilities and targets, combined with the Company's operating performance, work innovation, rewards and penalties, and annual performance evaluation results.
- Comprehensive Consideration Principle: The compensation plan is linked to the Company's operating performance and the completion of operational goals.
- Competitive Principle: Emphasis is placed on market-oriented income, establishing a reasonable salary structure ratio to maintain the attractiveness of the Company's compensation and its competitiveness in the market, which is beneficial for attracting talent.
Chapter 2 Management Institutions
Article 1
The Company's Board of Directors' Compensation and Assessment Committee (hereinafter referred to as "the Committee") is responsible for confirming the compensation levels of senior executives and performance evaluation assessments, formulating and reviewing the compensation decision-making mechanism, decision-making processes, payment and recovery arrangements, and other compensation policies and plans, and making recommendations to the Board of Directors on senior executives' compensation matters.
Article 2
The Company's Human Resources Management Department and Financial Management Department cooperate with the Committee to implement the compensation plan for the Company's directors.
Article 3
The senior executives' compensation plan is approved by the Board of Directors, explained to the shareholders' meeting, and fully disclosed.