Fuanna Announcements Draft Equity Incentive

Comments: it is reported that the options granted to 196 people, including 2 new executives and 194 middle-level employees, covered the company's production,

If all the incentives are exercised, the number of employees will be 306, accounting for 9.77% of the total staff and 7.48% of the total share capital.

Large scale implementation of ESOP will enhance employee's enthusiasm and loyalty, which is conducive to the long-term development of enterprises.

The exercise is divided into three stages. The starting period is August 2012, August 2013 and August 2014. The termination period is August 2015.

The proportion of exercise rights at each stage is 30%, 30% and 40%.

(assuming the first authorized date in August 2010) the three stage exercise conditions correspond to the operating performance in 2011, 2012 and 2013 respectively. Specifically, the annual ROE (net asset yield) is no less than 10%; the net profit of 2009 is the base, and the growth rate is no less than 65%, 105% and 145%.

Fuanna's net profit in 2009 was 86 million 110 thousand yuan, and its minimum performance indicators to meet the exercise conditions were calculated as follows: the net profit of 2011-2013 years was 142 million yuan, 177 million yuan and 211 million yuan, corresponding to EPS1.06 yuan, 1.32 yuan and 1.58 yuan.

The home textile industry is in a period of high growth. As a leading company, fuanna has a high probability of satisfying or even exceeding the right conditions in the future. It is estimated that 2010-2012 years EPS (earnings per share) is 0.85 yuan, 1.11 yuan and 1.40 yuan respectively (the performance forecast for 1011 and 2012 is higher than that of the company).

We maintain our investment rating of "cautious increase".