Xinjiang Machinery Research Institute Co., Ltd announced that it has entered into Conditionally Effective Share Subscription Agreement with new investors Ningbo Huakong Qianjia Enterprise Management Consulting Co., Ltd. for 294,117,647 shares and Jiaxing Huakong Tenghui Equity Investment Partnership (Limited Partnership) for 58,823,529 shares; aggregate gross proceeds to issue 352,941,176 A shares at an issue price of CNY 1.70 per share for the gross proceeds of CNY 599,999,999.2 on May 13, 2024. The transaction has been approved in the 16th meeting of the fifth session of the Board of Directors and is subject to company?s general meeting of shareholders, the Shenzhen Stock Exchange and the registration approval of the China Securities Regulatory Commission. After the issuance to specific subscribers is completed, the shares subscribed by the issuance subscribers shall not be transferred within 18 months from the date of completion of the issuance.

During the restricted sale period, the shares obtained by the issuance target through the company's bonus shares, conversion of capital reserve into share capital, etc. shall also comply with the aforementioned restricted sale arrangement. After the expiration of the lock-up period, the transfer and trading of such shares shall be carried out in accordance with the laws, regulations and normative documents in effect at that time, as well as the relevant provisions of the China Securities Regulatory Commission and the Shenzhen Stock Exchange After the issuance is completed, Ningbo Huakong and Jiaxing Huakong will each hold 15.88% of the company.

% and 10.10% of the shares, Ningbo Huakong will become the company?s controlling shareholder.