Aurora Optoelectronics has released a performance compensation plan, targeting the long-standing difficulty in enforcing compensation obligations left over from its 2015 major asset restructuring. The plan proposes establishing a mechanism for lock-up share transferees to assume compensation duties, tying the eligibility to lift share lock-ups directly to the fulfillment of performance compensation obligations. The original actual controllers, Zuo Hongbo and Chu Shuxia, together owe approximately 391 million shares in compensation, accounting for over 90 percent of the total 403 million shares owed by all committed parties. However, the couple has never fulfilled their obligations and possesses no effective executable assets, leaving recovery efforts at an impasse. The plan stipulates that all shareholders who have legally acquired the couple's original lock-up shares must assume compensation obligations in proportion to their shareholdings. They must provide full cash compensation at a rate of 1.15 yuan per share plus accrued late interest before the lock-up can be lifted. The plan has been approved by the board of directors but still requires a verification opinion from an independent financial advisor and approval from the shareholders' meeting. The final recoverable amount remains highly uncertain.
Aurora Optoelectronics Co LtdProposed plan to link lock-up share release to compensation obligations, but final recoverable amount highly uncertain and requires shareholder approval.