Semiconductor Manufacturing International Corporation (SMIC) recently said it granted equity awards worth more than HK$17 million to eight executives.
As one of the weakest links in China's semiconductor industry, chip manufacturing is a top priority, especially advanced process technology. The biggest development for Chinese companies so far is the 14nm process for SMIC mass production at the end of 2019.
SMIC stated that a total of 9,464,602 options to subscribe for common shares of $0.004 par value per share in the capital of the Company were conditionally granted under the 2014 Stock Option Plan, which became effective on November 15, 2013.
The exercise price of the options is HK$18.096 per share, which translates into approximately HK$17 million, and the options are valid for a period of 10 years from 25 May 2020 and primarily reward eight executives.
Specifically, Chairman and Executive Director Zhou Zixue was granted approximately 659,100 share options, Executive Director and Co-CEO Zhao Haijun was granted approximately 219,700 share options, Executive Director and Co-CEO Liang Mengsong was granted approximately 659,100 share options, Gao Yonggang was granted approximately 586,800 share options, Chen Shanzhi was granted 62,500 share options, William Tudor Brown was granted 62,500 share options, Tong Guohua was granted 55,000 share options and Cong Jingsheng was granted approximately 55,000 share options.
SMIC said that the grant of restricted shares is part of the company's remuneration system, which aims to create a close relationship between shareholders, the company and its employees in terms of equity and benefit-sharing and risk-sharing, with a view to enhancing the motivation of directors.
The purpose of this grant of restricted shares is to provide adequate encouragement in attracting, retaining and motivating eight directors to participate in the continuing operations and long-term development of the Company and to recognize their contribution to the growth of the Company.
Among the eight executives who won the award, Liang Mengsong has a special status as he was previously an executive in TSMC's R&D department and is considered to be one of the key people who developed the successful 16nm process at TSMC, before jumping ship to Samsung. He joined SMIC in 2017 and then served as co-CEO, heading up the technology development side of the company.
Liang Mengsong is said to be responsible for SMIC's breakthrough in the 14nm process, but with the complexity of the current semiconductor process, the advanced process is not something that can be achieved by just one person, Liang Mengsong has at least accelerated the mass production of domestic 14nm process.
