China High Precision Automation Group Limited Issues Supplemental Announcement on Share Option Scheme

Key Points for Investors

• Large Share Option Grant: On 13 February 2025, China High Precision Automation Group Limited (“the Company”) granted a total of 33,474,000 share options to certain eligible participants under its newly adopted share option scheme.
• Scheme Adoption Date: The share option scheme was adopted on 13 February 2025, marking a significant move in incentivizing management and staff.
• No Performance Targets: The Remuneration Committee decided not to attach performance targets to the granted share options. This decision was made after considering several factors:
  • Granting share options gives grantees a personal stake in the Company, potentially motivating improved performance and efficiency.
  • The number of options granted was based on work performance, past contribution, and future potential to contribute to the Group’s business and sustainable development.
  • The value of these options depends directly on the market price of the Company’s shares, which is linked to business performance. Grantees benefit more as the share price increases.
• Purpose of the Scheme: The scheme aims to align interests between the grantees, the Company, and its shareholders, motivate commitment to the Company’s competitiveness and growth, and reinforce long-term service to the Company.
• Supplemental Announcement: The announcement provides additional details to the annual report for the year ended 30 June 2025, but does not affect other information in the annual report. All other disclosures remain unchanged.
• Board Composition: As of 25 February 2026, the Board includes both executive and independent non-executive directors, with Chairman Wong Fun Chung signing off on the announcement.

Shareholder and Price-sensitive Information

• Potential Impact on Share Price:
  • The grant of a substantial number of share options (33.47 million) could be seen as a major incentive for management and staff, potentially affecting their motivation and future performance.
  • The lack of performance targets means that the share options are more flexible and could be exercised regardless of future performance metrics. This approach may be viewed both positively (motivation, retention) and negatively (potential dilution, lack of performance alignment) by investors.
  • Option value is tied to share price appreciation—if the Company performs well, grantees stand to benefit significantly, aligning their interests with shareholders.
  • Potential dilution: The issuance of a large number of options may dilute existing shareholders if exercised. Investors should consider this possibility when evaluating future share value.
• Corporate Governance Implications: The Remuneration Committee’s decision not to require performance targets is a notable governance choice and may attract investor scrutiny regarding how incentives are structured.
• Continued Transparency: The Company’s commitment to supplementing its annual report with further details on the share option scheme reflects ongoing transparency.

Detailed Insights

• The share option scheme is designed as an incentive and reward mechanism to recognize and acknowledge contributions and potential contributions from eligible participants.
• The Remuneration Committee believes that the grant, without performance targets, aligns interests and encourages commitment to the Company’s long-term competitiveness and growth.
• All other aspects of the annual report for the year ended 30 June 2025 remain unchanged, ensuring that this supplemental announcement is focused solely on the share option scheme.
• Executive Directors include Mr. Wong Fun Chung, Mr. Zou Chong, Mr. Su Fang Zhong, and Mr. Cheung Chuen. Independent Non-executive Directors are Ms. Ji Qin Zhi, Dr. Hu Guo Qing, Mr. Chan Yuk Hiu, Taylor, and Dr. Huang Shizhen.
• The announcement was officially issued in Hong Kong on 25 February 2026.

Conclusion

The grant of 33,474,000 share options to eligible participants without performance targets is a significant development for China High Precision Automation Group Limited. This move is likely to impact investor sentiment, given its potential to motivate management and staff and its implications for share price performance and dilution. Investors should closely monitor future developments related to option exercise and overall Company performance.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors are advised to conduct their own research and consult with professional advisors before making any investment decisions. The information provided reflects disclosures from official Company documents and may be subject to change.

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