Baidu, Inc. has released the full framework of its 2026 Share Incentive Plan, designed to strengthen long-term alignment between eligible participants and the company’s shareholders.

The plan authorizes the grant of share options, restricted shares and restricted share units (RSUs) to employees, directors and certain consultants. Its stated goal is to “promote the success and enhance the value” of Baidu by linking personal interests with shareholder returns and reinforcing talent retention.

Key parameters include:

• Size of the pool: The aggregate number of Class A and Class B ordinary shares that can be issued under the plan, together with outstanding unexercised options from other share schemes, is capped at 10% of Baidu’s total issued share capital (excluding treasury shares) on the date of shareholder approval (the “Scheme Limit”). Within this, grants to consultants are further capped at 0.5% of total shares (the “Consultant Sublimit”).

• Instruments: Awards may take the form of (i) share options (both incentive and non-qualified), (ii) restricted shares, or (iii) RSUs. Options carry a maximum term of 10 years. Exercise prices must not be set below the higher of (a) the share’s closing price on the Hong Kong Stock Exchange (HKEX) or Nasdaq on the grant date, and (b) the average closing price over the preceding five trading days.

• Vesting rules: Except in limited circumstances permitted by applicable regulations, each grant must have an overall vesting period of at least 12 months. Awards may include performance conditions based on metrics such as share-price appreciation, earnings per share, return on equity, revenue, cash flow and other financial or operational targets.

• Restricted periods for grants: No awards may be granted while Baidu holds inside or material non-public information, or within 30 days before the board’s approval of interim or quarterly results, or within 60 days before annual results (with stricter limits for directors and certain connected persons).

• Governance and compliance: The plan will be administered by Baidu’s Compensation Committee, with additional approvals required for grants that could exceed 1% of issued shares to any single participant in a 12-month period, or 0.1% to directors, substantial shareholders or their associates, in line with HKEX Chapter 17 requirements.

• Duration: The plan takes effect once Baidu becomes a primary-listed issuer on HKEX and will remain open for ten years, subject to earlier termination or amendment by the board with any requisite shareholder approvals.

• Adjustment and clawback provisions: The committee may adjust award terms in the event of share splits, consolidations or other corporate actions. A clawback mechanism allows Baidu to forfeit or recoup awards upon events such as misconduct or dismissal for cause.

All awards will be settled in Class A ordinary shares or American depositary shares (ADSs) and will not confer shareholder rights until issuance. The plan expressly disclaims any impact on existing benefit arrangements and emphasizes compliance with Cayman Islands law, U.S. tax regulations and HKEX listing rules.