Remuneration Management System for Directors and Senior Management of PLC

Remuneration Management System for Directors and Senior Management

Placo Bioengineering Co., Ltd.

Remuneration Management System for Directors and Senior Management

Chapter 1 General Provisions

Article 1 In order to further improve the salary management of directors and senior managers of Pleco Bioengineering Co., Ltd. (hereinafter referred to as the "Company"), establish a scientific and effective incentive and restraint mechanism, and fully mobilize and exert the work enthusiasm and creativity of directors and senior managers, this system is formulated in accordance with the "Company Law of the People's Republic of China" and other relevant laws and regulations and the "Articles of Association of Pleco Bioengineering Co., Ltd." (hereinafter referred to as the "Articles of Association") and in combination with the actual operating conditions of the company.

Article 2 This system applies to company directors and senior managers. Specifically include the following personnel:

(1) Independent directors: refers to directors who are hired in accordance with relevant laws and regulations and have no direct or indirect interest relationship with the company, major shareholders or actual controllers, or other relationships that may affect their independent and objective judgment.

(2) Non-independent directors: refers to directors who have signed a labor contract with the company or do not hold specific positions in the company and its subsidiaries.

(3) Senior management personnel: refers to the senior management personnel stipulated in the Articles of Association, specifically including: general manager, deputy general manager, financial director, and board secretary.

Article 3 The remuneration management of the company’s directors and senior managers shall follow the following principles:

(1) The salary level is closely related to the company’s size and performance, and is consistent with the external market salary level;

(2) The salary level is consistent with the value of the position and the level of responsibilities and obligations;

(3) The salary level is consistent with the company’s goals of sustained, stable and healthy development;

(4) Salary standards are linked to performance appraisal results, and personal income is linked to company benefits.

Chapter 2 Composition and Determination of Remuneration

Article 4 The remuneration of the company's directors and senior managers consists of basic annual salary, performance annual salary, special rewards, allowances, and inclusive rewards, benefits and salary adjustments that the company's employees should enjoy.

Article 5 Remuneration payment and decision-making procedures for directors and senior managers of the company:

(1) Independent directors: The company’s independent directors pay director allowances, and the specific payment standards are determined by the board of directors.

The remuneration management system and assessment committee for directors and senior managers will be drafted and submitted to the board of directors for review and implemented after approval by the shareholders' meeting.

(2) Non-independent directors: Non-independent directors who serve as senior managers or other positions in the company or subsidiaries shall receive remuneration according to the remuneration system of their positions and will not receive additional director allowances. Non-independent directors who do not hold specific positions in the company and subsidiaries do not receive allowances or remuneration. The specific payment standards and assessment methods are formulated by the Remuneration and Assessment Committee, and after review by the Board of Directors, they are submitted to the shareholders' meeting for approval before implementation.

(3) Senior managers: The company's senior managers implement an annual salary system, and their annual salary consists of two parts: basic annual salary and annual performance salary. The basic annual salary is determined based on industry salary levels, job responsibilities and performance of duties; the annual performance salary is based on the annual performance contract signed and linked to the company's annual operating performance. After the end of each fiscal year, it is assessed and assessed by the Remuneration and Appraisal Committee of the company's board of directors, and is implemented after approval by the board of directors.

Article 6 The social insurance and housing provident fund of directors and senior managers shall be handled in accordance with relevant national and local regulations; the subsidies and benefits enjoyed by directors and senior managers shall be in accordance with the company's relevant systems or policies.

Article 7 The remuneration of directors and senior management personnel is pre-tax remuneration, and personal income tax should be withheld in accordance with the provisions of the Personal Income Tax Law.

Chapter 3 Assessment and Payment of Salary

Article 8 The allowances for the company's independent directors and the basic annual salaries of the company's non-independent directors and senior managers shall be paid on an average month-by-month basis.

Article 9 The performance-based annual salary of the company's non-independent directors will be assessed by the remuneration and assessment committee of the board of directors after the end of the accounting year and submitted to the board of directors for review.

Article 10 For directors’ remuneration that requires review and approval by the shareholders’ meeting, the shareholders’ meeting authorizes the board of directors or management to formulate relevant payment and assessment plans in advance based on actual needs, and distribute them in advance according to the relevant plans, and will wait for confirmation or adjustment at the latest shareholders’ meeting.

Article 11 If a director or senior manager commits a major illegal act or other act prohibited by laws and regulations that causes damage to the company during his term of office, the company's board of directors and its remuneration and assessment committee will decide to deduct or cancel his or her performance-based annual salary.

Chapter 4 Supplementary Provisions

Remuneration Management System for Directors and Senior Management

Article 12 Matters not covered by this system shall be implemented in accordance with relevant national laws and regulations, the Articles of Association and other provisions.

Article 13 The company’s board of directors is responsible for interpreting the content of the remuneration system for directors and senior managers in this system.

Article 14 After this system is reviewed and approved by the company's board of directors, it shall be submitted to the company's shareholders' meeting for approval and shall come into effect on the date of review and approval by the company's shareholders' meeting.