Core Viewpoint - The independent financial advisor report on the 2025 Restricted Stock Incentive Plan of Yuhuan CNC Machine Tool Co., Ltd. confirms that the plan complies with relevant laws and regulations, and it is deemed feasible and beneficial for the company's sustainable development [4][41][18]. Group 1: Compliance and Feasibility - The company does not fall under any prohibitive conditions for implementing the stock incentive plan as per the Management Measures [4][40]. - The independent financial advisor has conducted thorough investigations and confirmed that the plan's provisions align with the Company Law, Securities Law, and relevant regulations [5][40]. - The plan's operational procedures are deemed feasible, and the outlined matters comply with the Management Measures [5][11]. Group 2: Incentive Object and Allocation - The incentive objects are determined based on legal qualifications and are all employees of the subsidiary Hunan Southern Machine Tool Co., Ltd. [8][43]. - The total number of restricted stocks to be granted is 1,040,000 shares, accounting for 0.67% of the company's total share capital [10][11]. - The allocation of stock incentives ensures that no single incentive object receives more than 1% of the total share capital [11][10]. Group 3: Pricing and Financial Support - The grant price for the restricted stocks is set at 11.46 yuan per share, which meets the regulatory requirements [12][13]. - The plan explicitly states that the company will not provide any financial assistance to the incentive objects, ensuring the protection of the company's interests [14][41]. Group 4: Performance Assessment - The performance assessment system includes both subsidiary-level and individual-level evaluations, with specific revenue growth targets set for the subsidiary [21][22]. - The performance indicators are designed to be reasonable and scientifically based, promoting the company's high-quality development [21][22]. Group 5: Approval Process - The plan has been approved by the company's board of directors and supervisory board, and it will be submitted for approval at the upcoming shareholders' meeting [39][42]. - The necessary procedures for the plan's implementation have been followed, ensuring compliance with legal and regulatory requirements [15][41].

Core Viewpoint - The report outlines the independent financial advisor's assessment of the 2025 restricted stock incentive plan for Yuhuan CNC Machine Tool Co., Ltd, confirming its compliance with relevant regulations and its potential positive impact on the company's performance and shareholder interests [4][11][10]. Summary by Sections 1. Definitions - The report defines key terms related to the incentive plan, including "restricted stock," "incentive objects," and "grant date," providing clarity on the plan's structure and conditions [1]. 2. Independent Financial Advisor's Declaration - The independent financial advisor emphasizes that the report is based on documents provided by Yuhuan CNC, which are guaranteed to be legal, accurate, and complete [2]. 3. Basic Assumptions - The report is based on assumptions regarding the stability of current laws and regulations, the reliability of provided documents, and the absence of unforeseen adverse factors affecting the incentive plan [3]. 4. Advisor's Opinions - The advisor confirms that the implementation of the incentive plan complies with regulatory requirements and that the plan's operational procedures are feasible [4][5]. - The advisor assesses the eligibility and scope of the incentive objects, ensuring compliance with relevant laws and regulations [6][7]. 5. Equity Grant Amount - The plan proposes to grant a total of 1,040,000 shares, representing 0.67% of the company's total share capital, with no reserved rights [8]. 6. Grant Price - The grant price for the restricted stock is set at 11.46 RMB per share, which meets the regulatory requirements for pricing [9][8]. 7. Financial Assistance Prohibition - The plan explicitly prohibits the company from providing any financial assistance to the incentive objects for acquiring shares, ensuring the integrity of the incentive structure [10]. 8. Impact on Company and Shareholders - The advisor concludes that the incentive plan is expected to positively influence the company's operational capabilities and shareholder value, aligning the interests of management with those of shareholders [11][14]. 9. Performance Assessment - The performance assessment framework includes both company-level and individual-level evaluations, with specific revenue growth targets set for the subsidiary, South Machine Tool Co., Ltd [14][15].