-- Announcement on Lifting Sales Restrictions and Listing for Circulation in the 2nd Restriction Period for the 1st Grant under 2023 Restricted Stock Incentive Plan
Securities code: 603590 Securities abbreviation: Kangchen Pharmaceutical Announcement number: Lin 2025-053
Beijing Kangchen Pharmaceutical Co., Ltd.
About the Initial Grant of the Company’s 2023 Restricted Stock Incentive Plan
Lifting of sales restrictions and listing announcement during the second sales restriction period
The company's board of directors and all directors guarantee that the contents of this announcement do not contain any false records, misleading statements or major omissions, and assume legal responsibility for the authenticity, accuracy and completeness of its contents in accordance with the law.
Important content reminder:
The type of stock listing this time is equity incentive shares; the stock subscription method is offline, and the number of listed shares is 796,000.
The total number of shares outstanding in this listing is 796,000.
The listing and circulation date of this stock is September 22, 2025.
- Implementation of the Company’s 2023 Restricted Stock Incentive Plan (referred to as the “Incentive Plan”)
(1) Procedures completed for the equity incentive plan
On July 31, 2023, the company held the fourth meeting of the fourth board of directors and the third meeting of the fourth board of supervisors, and reviewed and approved the "Proposal on the Company's <2023 Restricted Stock Incentive Plan (Draft)> and its Summary" and the "Proposal on the Company's <2023 Restricted Stock Incentive Plan Implementation Assessment and Management Measures>" and other proposals. The company's independent directors have expressed independent opinions on the proposals related to this incentive plan. The company's Board of Supervisors verified the relevant matters of this incentive plan and issued relevant verification opinions.
From August 1, 2023 to August 10, 2023, the company publicized the names and positions of the first incentive recipients to be awarded under this incentive plan within the company. During the public announcement period, the company's supervisory board did not receive any objectionable feedback.
On August 16, 2023, the company held the third extraordinary general meeting of shareholders in 2023 to review and approve the "Proposal on the Company's <2023 Restricted Stock Incentive Plan (Draft)> and its Summary", the "Proposal on the Company's <2023 Restricted Stock Incentive Plan Implementation Assessment and Management Measures>" and the "Proposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors to Handle Equity Incentive-related Matters" and other motions.
On August 16, 2023, the company held the fifth meeting of the fourth board of directors and the fourth meeting of the fourth board of supervisors, and reviewed and approved the "Proposal on Granting Restricted Stocks to Incentive Objects". The company's independent directors expressed independent opinions on relevant proposals. The company's Board of Supervisors verified the list of first-time incentive recipients granted under the 2023 restricted stock incentive plan and issued verification opinions. On August 17, the company disclosed the "Self-examination Report on the Purchase and Sale of Company Stocks by Insiders of the 2023 Restricted Stock Incentive Plan."
On September 23, 2023, the company disclosed the "Announcement on the Results of the First Grant of the 2023 Restricted Stock Incentive Plan". The company completed the registration for the first grant of restricted shares on September 21, 2023, and actually granted 2.49 million restricted shares to 21 incentive targets.
On July 16, 2024, the company held the 10th meeting of the fourth board of directors and the eighth meeting of the fourth board of supervisors, and reviewed and approved the "Proposal on Granting Reserved Restricted Stocks to Incentive Objects of the 2023 Restricted Stock Incentive Plan and Adjusting the Grant Price" and "About the Company's 2023 The Proposal on the Repurchase and Cancellation of Restricted Stocks Restricted to Part of the Incentive Objects that Have Been Granted but Not Unrestricted and the Repurchase Price Adjustment. The company's board of supervisors issued approval verification opinions on relevant matters. The above matters have been reviewed and approved by the company's Remuneration and Assessment Committee and the special meeting of independent directors.
On September 6, 2024, the company disclosed the "Announcement on the Result of Reserved Grants of the 2023 Restricted Stock Incentive Plan". The company completed the registration of the reserved portion of restricted shares on September 4, 2024, and actually granted 530,000 restricted shares to 13 incentive targets.
On September 29, 2024, the company held the 12th meeting of the fourth board of directors and the 10th meeting of the fourth board of supervisors. On October 29, 2024, the company held the second extraordinary shareholders' meeting of 2024, which reviewed and approved the "Proposal on the Repurchase and Cancellation of Restricted Stocks that have been granted to some incentive targets but have not yet been released from sale restrictions and the adjustment of the repurchase price."
On December 27, 2024, the company disclosed the "Announcement on the Implementation of the Repurchase and Cancellation of the 2023 Restricted Stock Incentive Plan". The company applied to the Shanghai Branch of China Securities Clearing Co., Ltd. to handle the repurchase and transfer procedures for 154,900 restricted shares held by two incentive recipients that have been granted but have not yet been released from sale restrictions. The cancellation of this part of the shares was completed on December 31, 2024.
The company held the 16th meeting of the fourth board of directors and the 13th meeting of the fourth board of supervisors on April 25, 2025, and held the 2024 annual shareholders' meeting on May 16, 2025, to consider and adopt the "Proposal on the Repurchase and Cancellation of Restricted Stocks that have been granted to some incentive targets but have not yet been released from sale and the adjustment of the repurchase price" and other proposals.
On June 23, 2025, the company held the 17th meeting of the fourth board of directors and the fourth board of supervisors
At the 14th meeting, the "Part 1 Concerning the Initial Grant of the Company's 2023 Restricted Stock Incentive Plan" was reviewed and approved.
Two proposals to lift the sales lock-up period and set aside the granting of the first partial release of the sales lock-up period and the achievement of the conditions for lifting the sales lock-up, etc.
motion. The above matters have been reviewed and approved by the company's Remuneration and Assessment Committee and the special meeting of independent directors.
At each of the above stages, the company has fulfilled its disclosure obligations as required. For details, please see the company’s information on the Shanghai Stock Exchange.
Announcement published on the website (www.sse.com.cn).
(2) Previous grants of restricted stocks
Grant registration date Grant Grant batch of grant shares Grant date Grant price
Period Number of people Number of votes Restricted shares in 2023
September 2023 17.03 yuan/2.49 million votes Incentive plan awarded for the first time August 16, 2023 21 people
21st Shares Shares
give
2023 Restricted Stock
September 2024 16.73 yuan/
Voting Incentive Plan Reserved Grant July 16, 2024 13 people 530,000 shares 4 days Shares
give
(3) Previous releases of restricted stocks
Remaining unsolved Cancel Unlock Unlimited quantity
Batch Release date of sales restrictions Number of items except sales restrictions Number of shares subject to sales restrictions (shares)
Volume (shares) and reasons: 154,900 shares; 1 investor
The incentive objects are restricted stocks in 2023.
Resignation, 1 incentive plan granted for the first time
September 23, 2024 746,100 1,589,000 incentives for the first
The elephant assessment symbol lifts the sales restriction period
70% of sales restrictions lifted
2023 Restricted Stock 150,000 Incentive Plan Reserved Grant Shares; 2 Incentives September 4, 2025 190,000 190,000
The first reward object has been
Lifting the lock-up period Resigning in 2023 Restricted stocks 196,000 Incentive plan first granted shares; 2 incentives September 22, 2025 796,000 597,000
The second incentive object has been
Lifting the lock-up period and resigning
- Achievement of conditions for lifting sales restrictions during the second lifting period for the first grant of this incentive plan
(1) Explanation that the sales restriction period is about to expire
The registration date for the first grant of restricted shares under this incentive plan is September 21, 2023.
The sale period will expire on September 20, 2025.
According to the provisions of this incentive plan, the unlocking period and
The timetable for lifting sales restrictions in each period is as shown in the table below:
Arrangements for lifting sales restrictions. Time for lifting sales restrictions. Ratio of lifting sales restrictions.
The first period shall be from the first trading day 12 months after the completion of registration of the first grant to the date of the first grant.
The 30% unlocking period ends on the last trading day within 24 months from the date of completion of registration.
The second period shall be from the first trading day 24 months after the completion of registration of the first grant to the date of the first grant.
The 40% unlocking period ends on the last trading day within 36 months from the date of completion of registration.
The third period shall be from the first trading day 36 months after the completion of registration of the first grant to the date of the first grant.
The 30% unlocking period ends on the last trading day within 48 months from the date of completion of registration.
(2) Description of achievements in lifting sales restrictions
The company's 2023 restricted stock incentive plan first granted part of the second unlocking period and unlocking qualifications
In conjunction with the "2023 Restricted Stock Incentive Plan Implementation Assessment Management Measures" (hereinafter referred to as: "Assessment Management Office
Law).
Release of sales restrictions and achievement description
(1) The company has not experienced any of the following situations: The company has not experienced any of the above situations.
- The financial accounting report for the most recent fiscal year has been issued by a certified public accountant to lift the sales restriction conditions.
Audit reports with negative opinions or inability to express opinions;
- The internal control over the financial report of the most recent fiscal year was certified by a certified public accountant.
The auditor issues an audit report with a negative opinion or a disclaimer of opinion;
- In the past 36 months after listing, there has been any failure to comply with laws, regulations, or company regulations.
Articles of Association and public commitment to profit distribution;
Equity incentives are not allowed according to laws and regulations;
Other circumstances determined by the China Securities Regulatory Commission.
(2) None of the following circumstances have occurred to the incentive recipients: The incentive recipients have not experienced the above circumstances.
The person has been deemed unsuitable by the stock exchange in the past 12 months; the condition is met for lifting the sales restrictions.
Be recognized by the China Securities Regulatory Commission and its dispatched agencies within the past 12 months as
unsuitable candidate;
- In the past 12 months, the China Securities Regulatory Commission has
and its dispatched agencies shall impose administrative penalties or take market entry ban measures;
- Those who meet the provisions of the Company Law are not allowed to serve as directors or senior officers of the company.
Management personnel situation;
Not allowed to participate in equity incentives of listed companies according to laws and regulations;
Other circumstances determined by the China Securities Regulatory Commission.
(3) Company-level performance assessment requirements The company’s net profit growth in 2024
The performance assessment target of the second unlocking period for the first granted part of this incentive plan is 37%, not less than 30%. The performance assessment targets are as shown in the table below: The second unlocked period for the first granted part complies with the unlocking clause and the performance appraisal targets for the unlocked period.
The company-level sales restriction lifting ratio in 2024 must reach 100% in the following two cases.
One of the conditions: ① Based on the operating income in 2022 Note: The company’s net profit in 2024 excludes the first grant portion
As the base, the operating income growth rate in 2024 will be except when the equity incentive plan is lifted for the second time.
Not less than 30%; ② Based on the share-based payment fee generated in 2022 net profit sales period
Profit is used as the base, the net profit growth rate in 2024 is used, and the impact of goodwill impairment is excluded, which is not less than 30%. ring.
Note: ① The above “operating income” refers to the operating income of the audited consolidated financial statements of listed companies.
Total income, the same below.
②The above-mentioned “net profit” refers to the audited amount attributable to shareholders of listed companies after deducting extraordinary
net profit from net profit and loss, excluding the share capital generated by this and other equity incentive plans in the current year.
The impact of partial payment expenses and the impact of possible goodwill impairment are used as the basis for calculation, the same below.
(4) Individual-level performance appraisal requirements 1. The second solution for the first award part
The individual assessment of incentive targets is organized in accordance with the company's "2023 Restricted Stocks Excluding Restricted Period Personal Performance Achievement Incentive Plan Implementation Assessment and Management Measures" and other relevant assessment systems:
Implementation, and determine the proportion of incentive objects that are lifted from sales restrictions based on the assessment results (1) The first-time award is still in effect. There are 18 incentive targets in total, all
The actual amount of sales restrictions lifted by the incentive target individual in the current year = the individual's planned sales limit lifting quota in the current year to meet the individual-level performance appraisal × performance coefficient. Find , the proportion of sales restrictions lifted is
The performance evaluation results of incentive objects are divided into four levels, and the assessment score is 100%.
The price list is applicable to the assessment objects. At that time, the incentive object solution will be determined according to the following table. (2) The proportion of 3 incentive objects with sales restrictions due to resignation: No longer qualified for incentives, performance corresponding solution The company has outstanding performance for 1 incentive object
Performance Appraisal Result Appraisal Excluding restricted sales, the remaining 70% share repurchase and cancellation coefficient
Grade Ratio is completed; the company will subsequently complete the remaining 70% of the remaining 70% of the performance indicators for the other 2 incentive targets, and the key work results are Excellent 1.0 100% and all relevant transactions related to repurchase and cancellation have been completed. Continued.
Personal performance indicators
Completed but a critical job Good 0.7 70%
Achievements not completed
Personal performance indicators
Completed but two key tasks Passed 0.5 50%
Achievements not completed
Personal performance indicators
Disagreement
Not completed or two or more 0 0%
grid
Key work results are not completed
Restricted stocks that cannot be released from sale in the year of assessment by the incentive objects shall be
Repurchased and canceled by the company.
In summary, the Board of Directors believes that the conditions for the release of the lock-up period for the second release period for the first grant of the incentive plan have been met. According to the authorization of the company's third extraordinary general meeting of shareholders in 2023, it was agreed to handle matters related to the lifting of sales restrictions in accordance with the relevant provisions of the incentive plan.
(3) How to deal with restricted stocks that have not met the conditions for lifting sales restrictions
Restricted stocks that do not meet the conditions for lifting sales restrictions will be repurchased and canceled by the company.
3. Unlocking of sales restrictions on restricted stocks this time
The number of first-time incentive grant recipients who meet the conditions for lifting sales restrictions is 18, and the number of restricted stocks that can be lifted is 796,000 shares, accounting for 0.50% of the company's current total share capital. The details are as follows:
This time the sales restrictions are lifted. This time the sales restrictions are lifted.
The number of restricted shares that have been granted accounts for the number of restricted stocks that have been granted.
Number of shares (shares) Restricted stock ratio (shares)
Example
Niu Zhanqi Director, President 350,000 140,000 40.00% Some middle-level managers of the company (including subsidiaries)
Managerial personnel, core technical (business) personnel
1,640,000 656,000 40.00% Employees and the board of directors believe that incentives are needed
Other employees (17 people)
Total 1,990,000 796,000 40.00% Note: The number of stocks mentioned above is ultimately subject to the actual number registered by the Shanghai Branch of China Securities Depository and Clearing Co., Ltd.
4. Listing and circulation arrangements for restricted stocks that have been lifted this time and changes in capital structure
(1) The listing and circulation date of the restricted stocks that will be lifted this time: September 22, 2025
(2) The number of restricted stocks released this time is listed and circulated: 796,000 shares
(3) The lock-in and transfer restrictions of the restricted stocks that are lifted by directors and senior managers this time
If the incentive targets are directors and senior managers of the company, the shares transferred each year during their term of office shall not exceed 25% of the total number of shares of the company held by them. Within six months after leaving the company, the shares of the company held by them shall not be transferred.
If the incentive objects are directors and senior managers of the company, if they sell the company's stocks they hold within 6 months after buying them, or buy them again within 6 months after selling them, the proceeds will belong to the company, and the company's board of directors will take back the proceeds.
During the validity period of this incentive plan, if the relevant laws, regulations, normative documents such as the "Company Law of the People's Republic of China", the Securities Law of the People's Republic of China, and the "Articles of Association" change the relevant provisions on the transfer of shares held by the company's directors and senior managers, then the transfer of the company stocks held by these incentive objects shall comply with the revised relevant provisions at the time of transfer.
(4) Changes in the company’s share capital structure after the restriction of sales of restricted stocks is lifted
Type of securities Number before change (shares) Number after change (shares) Number after change (shares) Restricted tradable shares 1,929,000.00 -796,000.00 1,133,000.00 Unrestricted tradable shares 157,427,477.00 796,000.00 158,223,477.00
Total 159,356,477.00 0 159,356,477.00
Note: The number of shares before the change in the above table is the number of shares of the company as of the date of this announcement; the final share capital situation is based on the share capital structure table issued by the Shanghai Branch of China Securities Depository and Clearing Co., Ltd. after the completion of the repurchase and cancellation.
5. Concluding opinions of legal opinion
Beijing Guofeng Law Firm believes that the procedures that have been performed for matters related to the release of the lock-up period for the second part of the company's incentive plan granted for the first time are in compliance with the relevant provisions of the "Measures for the Administration of Equity Incentives for Listed Companies", the Articles of Association and the company's "2023 Restricted Stock Incentive Plan". The conditions for lifting the restrictions during the second unlocking period for the initial grant of restricted stocks stipulated in the "2023 Restricted Stock Incentive Plan" have been met. The company still needs to fulfill its information disclosure obligations in accordance with relevant laws, regulations, rules and normative documents and handle specific matters regarding the lifting of restrictions on restricted stocks.
Announcement is hereby made.
Board of Directors of Beijing Kangchen Pharmaceutical Co., Ltd.
September 17, 2025