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Wonder Auto Technology, Inc. ("Wonder Auto" or the "Company"), a leading manufacturer of automotive electric parts, suspension products and engine components in China, today announced that the compensation committee of the board of directors of the Company has approved an employee stock option award.
As part of the Company"s 2008 Employee Incentive Plan (the "Plan"), the Company"s compensation committee has approved the grant of 1,674,400 stock options, approximately 5% of total shares outstanding, to approximately 109 eligible key employees and directors which will vest over 3 years upon achievement of certain targeted annual pro forma net income thresholds of US$23 million for 2009, US$34.5 million for 2010 and US$42.3 million for 2011. One-third of the options will vest each year upon achievement of the respective targeted pro forma net income threshold. As approved by the compensation committee, the targeted pro forma net income equals the after-tax net income as reported in the Company"s Annual Report on Form 10-K plus any non-cash expenses, including, but not limited to, non-cash compensation expenses resulting from any grant of option award under the Plan, foreign exchange loss resulting from loans denominated in foreign currency and redemption accretion on convertible notes (if any). The awards allow for 5% deviation from the respective pro forma net income threshold. The options have a strike price of $11.48 per share and will terminate at the last business day of the 15th months after the respective vesting date.
Mr. Qingjie Zhao, Chief Executive Officer of Wonder Auto, commented, "This incentive plan will inject great enthusiasm into the management team and key employees throughout the Wonder Auto organization to reach our goal of achieving a compound annual growth rate of approximately 31% in pro forma net income from 2009 to 2011."