Chapter 1 General Principles
Article 1
To standardize the compensation management of directors and senior management at Shenzhen Hongfuhan Technology Co., Ltd. (hereinafter referred to as "the Company"), establish a scientific and effective incentive and constraint mechanism, effectively motivate the work enthusiasm and creativity of the Company's directors and senior management, and improve the operational management efficiency of the Company. This system is formulated in accordance with the "Company Law of the People's Republic of China," "Guidelines for the Governance of Listed Companies," and other relevant laws, regulations, normative documents, and the "Articles of Association of Shenzhen Hongfuhan Technology Co., Ltd." (hereinafter referred to as "the Articles of Association").
Article 2
This system applies to the following personnel:
- Directors, including non-independent directors, independent directors, and employee representative directors;
- Senior management personnel, including the company manager, deputy manager, board secretary, financial officer, and other personnel recognized by the company's board of directors.
Article 3
The compensation management for the Company's directors and senior management shall follow the principles below:
- Fairness principle, reflecting that income levels are consistent with the Company's scale and performance while considering market compensation levels;
- Unity of responsibility, authority, and interests principle, reflecting that compensation corresponds to the value of the position and the extent of responsibilities;
- Long-term development principle, reflecting that compensation aligns with the goals of the Company's sustainable and healthy development;
- Balance of incentives and constraints principle, reflecting that compensation distribution is linked to assessment, rewards, and penalties, and tied to the incentive mechanism.
Chapter 2 Compensation Management Institutions for Directors and Senior Management
Article 4
The compensation plans for directors and senior management of the listed company shall be formulated by the Board's Compensation and Assessment Committee, clarifying the basis for determining compensation and its specific components. The director compensation plan shall be decided by the shareholders' meeting and disclosed. When the board or the Compensation and Assessment Committee evaluates or discusses the compensation of an individual director, that director shall abstain from the discussion. The senior management compensation plan shall be approved by the board and explained to the shareholders' meeting, with full disclosure. If a board member also serves as senior management, that board member shall abstain from discussions regarding their compensation during evaluations.
Article 5
The Compensation and Assessment Committee of the board, authorized by the board, is responsible for formulating and reviewing the compensation standards and plans for the Company's directors and senior management; establishing performance standards for directors and senior management and organizing performance evaluations; and supervising the implementation of the Company's compensation system.
Article 6
The Compensation and Assessment Committee has the right to understand the Company's strategic planning, annual plans, financial and operational conditions, etc., and relevant departments of the Company shall provide related materials in a timely and accurate manner.
Article 7
The Company's human resources and finance departments assist the Compensation and Assessment Committee in evaluating the performance of non-independent directors and senior management serving within the Company, implementing the compensation plans for directors and senior management, and managing the daily distribution of compensation.
Article 8
The Company shall establish a total wage decision mechanism that is market-oriented, combined with the Company's operational conditions, strategic goals, and human resources strategy.