SHUANGHUAN COMPANY(SZ:002472) Zheng Quan Zhi Xing·2025-07-10 13:08Core Viewpoint - The independent financial advisory report evaluates the feasibility and implications of the employee stock ownership plan (ESOP) proposed by Zhejiang Double Ring Transmission Machinery Co., Ltd, emphasizing its alignment with regulatory guidelines and its potential to enhance company governance and employee motivation [1][27][29]. Summary by Sections Employee Stock Ownership Plan Overview - The ESOP aims to establish a mechanism for sharing interests between employees and shareholders, improving governance, and enhancing employee cohesion and competitiveness [27][29]. - The plan will involve a maximum of 358 employees, including directors, supervisors, senior management, and core employees, with total shares not exceeding 10% of the company's total capital [5][24]. Funding and Stock Source - Employees will fund their participation through legal salaries, self-raised funds, and other legally permitted means, with no financial assistance from the company [5][24]. - The stock will be sourced from the company's repurchased shares, with a maximum of 10,392,177 shares allocated for the ESOP [7][30]. Pricing and Valuation - The purchase price for the shares under the ESOP is set at 15.78 RMB per share, based on the average trading price of the company's stock prior to the announcement of the plan [30][29]. Duration and Lock-up Period - The ESOP will have a duration of 36 months, with a lock-up period where shares will be released in two phases after 12 and 24 months [10][11]. Performance Assessment - The performance assessment will include both company-level and individual-level evaluations, with specific profit targets set for 2025 and 2026 [13][14]. - The company aims for a net profit of no less than 1.3 billion RMB in 2025 and 1.5 billion RMB in 2026 to trigger full unlocking of shares [13][14]. Management Structure - The ESOP will be managed by a committee elected by the participants, ensuring transparency and adherence to regulations [20][21]. - The management committee will oversee daily operations and represent the interests of the participants [20][21]. Compliance and Feasibility - The report confirms that the ESOP complies with relevant laws and regulations, ensuring that it does not involve forced participation or insider trading [24][26]. - The company is deemed to have the necessary qualifications to implement the ESOP, which is expected to positively impact its long-term development and shareholder value [27][28].