Xinlun New Materials Co.,Ltd. announced a private placement of not more than 345,664,377 shares at a price of CNY 2.61 per share for gross proceeds of not more than CNY 902,184,000 on May 27, 2022. The transaction will include participation from Liao Yao for not more than 45,000,000 shares for CNY 117,450,000 and Shenzhen Shangyuan Huizhi Investment Partnership (Limited Partnership) for not more than 300,664,377 shares for CNY 784,734,023.97. The shares issued will be subject to restriction period of 18 months from closing.

The investors have signed an agreement with the company. Post completion of the transaction, Shenzhen Shangyuan Huizhi Investment Partnership (Limited Partnership) will become controlling shareholder of the company. The transaction has been approved at 40th meeting of the fifth session of the board of directors of the company, is subject to approval from general meeting of shareholders and by the China Securities Regulatory Commission.