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Stock Code: 002364 Stock Abbreviation: Zhongheng Electric
Hangzhou Zhongheng Electric Co., Ltd.
Third Employee Stock Ownership Plan
(Draft)
July 2026
Statement
The Company and all members of the Board of Directors guarantee that the contents of this employee stock ownership plan are true, accurate, and complete, and contain no false records, misleading statements, or major omissions.
Risk Warning
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The Company's third employee stock ownership plan must be approved by the Company's general meeting of shareholders before it can be implemented. There is uncertainty as to whether this draft plan will be approved.
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The specific scale, funding sources, contribution amounts, and implementation plan for this employee stock ownership plan are preliminary results; there is uncertainty regarding whether they can be fully implemented.
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If the total amount of funds subscribed by employees is low, there is a risk that this employee stock ownership plan cannot be established. If the number of shares subscribed by employees is insufficient, there is a risk that the plan will be smaller than the expected scale.
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There is uncertainty as to whether this employee stock ownership plan will achieve its goals. The description of company performance assessment indicators in this plan does not represent a performance forecast for the company, nor does it constitute a performance commitment.
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The Company will disclose relevant progress in accordance with regulations. Investors are advised to make decisions cautiously and pay attention to investment risks.
Special Tips
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The Third Employee Stock Ownership Plan (hereinafter referred to as the "Plan") of Hangzhou Zhongheng Electric Co., Ltd. (hereinafter referred to as the "Company") is formulated in accordance with the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Guiding Opinions on Pilot Projects for Employee Stock Ownership Plans of Listed Companies, the Self-Regulatory Guidelines for Listed Companies on the Shenzhen Stock Exchange No. 1 - Standardized Operation of Main Board Listed Companies, and other relevant laws, regulations, and the Articles of Association of Hangzhou Zhongheng Electric Co., Ltd.
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This Plan follows the principles of legality, compliance, voluntary participation, and risk-bearing, and there are no circumstances of forced participation.
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Participants in this Plan include the Company's (including subsidiaries) directors, senior management, and core personnel. The total number of employees participating shall not exceed 40, including 5 directors and senior management. The specific number of participants will be determined based on actual payments.
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The total funding for this Plan shall not exceed RMB 40 million. The subscription unit is "share" at RMB 1 per share, with a total of no more than 40 million shares. Funding sources are legal employee compensation, self-raised funds, and other methods permitted by law. The Company will not provide any financial assistance such as advances, guarantees, or loans to holders.
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The source of shares for this Plan is 1,804,400 A-share common shares of Zhongheng Electric already repurchased in the Company's dedicated repurchase account, representing 0.32% of the Company's total share capital on the date of the draft announcement.
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After implementation, the total number of shares held by all effective incentive plans will not exceed 10% of the Company's total share capital, and the shares corresponding to the equity held by a single employee will not exceed 1% of the Company's total share capital.
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The transfer price for this Plan is set at RMB 21.79 per share, which is not lower than the higher of the following:
(1) 50% of the average trading price of the Company's shares on the trading day prior to the announcement of this draft, which is RMB 38.53 per share.
(2) 50% of the average trading price of the Company's shares for the 120 trading days prior to the announcement of this draft, which is RMB 43.57 per share.