China Yuchai International Limited (CYD), a Singapore-based powertrain solutions manufacturer, has approved and implemented an equity incentive plan for its subsidiary, Guangxi SKY Cloud Technology Co., Ltd.
The plan, approved by Yuchai's shareholders, aims to grant equity interests in Sky Cloud to selected employees, directors, and senior officers.
Sky Cloud, a wholly owned subsidiary of Yuchai with a registered capital of RMB 5 million, will see its capital increase by RMB 1.25 million, representing a 20% stake in the expanded entity. This interest will be distributed in two phases: Phase One involves an aggregate grant of RMB 1,080,002 at a subscription price of RMB 1 per RMB 1 registered capital. Phase Two, set for completion by June 30, 2027, will be offered at either 80% of the latest audited net asset value or RMB 1 per unit, whichever is higher.
The granted equity will be held through separate partnership vehicles established by the participants, with direct ownership in these vehicles subject to specific lock-up restrictions under the plan. The initiative is designed to incentivize key employees and strengthen their long-term commitment to Sky Cloud's growth and Yuchai's overall success.
Under International Financial Reporting Standards - IFRS, China Yuchai expects share-based expenses related to the plan, determined by a valuation of Sky Cloud. However, the financial impact is anticipated to be minimal.
CYD is currently trading at $19.07 or 0.32% lower on the NYSE.
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