Securities code: 688114 Securities abbreviation: Huada Zhizao Announcement No.: 2024-047.

Shenzhen Huada Zhizao Technology Co., Ltd.

Regarding the grant of restricted stock to the incentive target of the 2024 Restricted Stock Incentive Plan.

Announcement

the company's board of directors and all directors to ensure that the contents of this announcement does not exist any false records, misleading statements or major omissions, and the authenticity, accuracy and completeness of the contents of the legal responsibility.

Important Content Tips:

Restricted Stock Grant Date: July 2, 2024

Number of restricted shares granted: 6.555 million shares, accounting for about Shenzhen Huada Zhizao Technology Co., Ltd. (in order

hereinafter referred to as the "Company") 2024 Restricted Stock Incentive Plan (hereinafter referred to as the "Incentive Plan")

1.58 of 415.6376 million shares of the total share capital of the Company at the time of announcement

Equity Incentive Method: Class II Restricted Stock

The conditions for granting restricted stock under the Company's "2024 Restricted Stock Incentive Plan (Draft)" (hereinafter referred to as the "Incentive Plan") have been fulfilled, and according to the authorization of the Company's 2023 Annual General Meeting of Shareholders, the public

The company held the seventh meeting of the second board of directors and the seventh meeting of the second board of supervisors on July 2, 2024

The Bill on the Grant of Restricted Stock to Incentive Objects was considered and passed, and it was determined that July 2024

The 2nd is the grant date, and the 6.555 million is granted to 316 incentive objects at the grant price of RMB 26.15 per share.

shares of restricted stock. The relevant matters are explained as follows:

1. Restricted Stock Grants

(I) relevant approval procedures and information disclosure that have been performed under this Incentive Plan

1. On June 11, 2024, the company held the sixth meeting of the second board of directors, which was approved.

The proposal on the company's 2024 restricted stock incentive plan (Draft) and its summary, the proposal on the assessment and management measures for the implementation of the 2024 restricted stock incentive plan, and the proposal on requesting the company's general meeting of shareholders to authorize the board of directors to handle matters related to equity incentive. On the same day, male

The company held the sixth meeting of the second board of supervisors, deliberated and passed the proposal on the company's 2024 restricted stock incentive plan (Draft) and its summary, the proposal on the implementation assessment and management measures of the company's 2024 restricted stock incentive plan, and the proposal on verifying the list of incentive objects of the company's 2024 restricted stock incentive plan, the board of supervisors of the company verified the relevant matters of this incentive plan and issued relevant verification opinions.

2. On June 12, 2024, the Company disclosed on the website of the Shanghai Stock Exchange (www.sse.com.cn)

Announcement on the Public Solicitation of Entrusted Voting Rights by Independent Directors (Announcement No. 2024-037). According to the entrustment of other independent directors of the company, independent director Xu huaibin, as the solicitor, solicited voting rights from all shareholders of the company on the relevant proposals of the equity incentive plan considered by the annual general meeting of shareholders in 2023.

3. From June 12, 2024 to June 21, 2024, the company intends to encourage the target of this incentive plan.

The name and position of the company were publicized within the company. As of the expiration of the publicity period, the company's supervisory board has not received any members.

Any objections raised by the workers to the list of proposed incentives. On June 22, 2024, the company was in Shanghai Securities.

The exchange's website (www.sse.com.cn) disclosed the "Statement of the Supervisory Board's Publicity and Verification Opinions on the List of Incentive Objects of the Company's 2024 Restricted Stock Incentive Plan".

4. On June 28, 2024, the Company held its 2023 Annual General Meeting of Shareholders, which considered and adopted the "Guan".

Proposal on the "Company's 2024 Restricted Stock Incentive Plan (Draft)" and its summary "," Proposal on the Company's "2024 Restricted Stock Incentive Plan Implementation Assessment Management Measures", "About requesting the company's general meeting of shareholders to authorize the board of directors to handle equity incentives" Proposal on related matters "and other proposals.

5. On June 29, 2024, the Company disclosed on the website of the Shanghai Stock Exchange (www.sse.com.cn)

The Self-Examination Report on the Trading of Company Shares by Insiders of the 2024 Restricted Stock Incentive Plan.

6. On July 2, 2024, the company held the seventh meeting of the second board of directors and the second board of supervisors.

At the seven meetings, the "Proposal on Adjusting Matters Related to the Company's 2024 Restricted Stock Incentive Plan" and "The Proposal on Granting Restricted Stocks to Incentive Objects" were reviewed and approved. The Supervisory Board verified the aforementioned matters and issued a verification opinion.

(II) statement of the Board of Directors on compliance with the conditions for the award, a clear opinion issued by the Supervisory Board

1, the board of directors on whether the grant meets the conditions of the relevant instructions.

According to the provisions of the grant conditions in the Incentive Plan, the restricted stock granted to the incentive object must also meet the following conditions:

(1) None of the following has occurred in the Company:

① The financial accounting report of the most recent fiscal year has been issued by a certified public accountant with a negative opinion or an audit report that cannot express an opinion;

② An audit report on internal control over financial reporting in the most recent fiscal year in which a certified public accountant has issued a negative opinion or is unable to express an opinion;

③ In the last 36 months after listing, there has been any failure to distribute profits in accordance with laws and regulations, articles of association and public commitments;

④ Laws and regulations do not allow the implementation of equity incentives;

⑤ Other circumstances determined by the CSRC.

(2) The incentive object does not have any of the following situations:

① Identified as inappropriate by the stock exchange within the last 12 months;

② identified as inappropriate by the CSRC and its dispatched offices within the last 12 months;

③ Within the last 12 months, the CSRC and its dispatched offices have imposed administrative penalties or taken market ban measures for major violations of laws and regulations;

④ those who are not allowed to serve as directors or senior managers of the company as stipulated in the the People's Republic of China Company Law;

⑤ Laws and regulations stipulate that it is not allowed to participate in equity incentives for listed companies;

⑥ Other circumstances determined by the CSRC.

After careful verification, the board of directors of the company has determined that neither the company nor the incentive object has any of the above circumstances, nor is there any other situation that cannot be granted or cannot be the incentive object, and the conditions for the award of this incentive plan have been fulfilled.

2, the board of supervisors on whether the award meets the conditions of the relevant explanation.

(1) The company does not have the "Administrative Measures for Equity Incentives of Listed Companies" (hereinafter referred to as the "Administrative Measures") and other laws, regulations and regulatory documents that prohibit the implementation of equity incentive plans, and the company has the main body of the implementation of restricted stock incentive plans Qualifications; the incentive objects of the company's 2024 restricted stock incentive plan have the qualifications stipulated in the the People's Republic of China Company Law and other laws, regulations and regulatory documents, it meets the conditions of incentive objects stipulated in the administrative measures and the Listing Rules of Shanghai Stock Exchange Science and technology innovation board (hereinafter referred to as the listing rules), and meets the scope of incentive objects stipulated in the company's incentive plan and its summary, and its subject qualification as the incentive object of the company's 2024 restricted stock incentive plan is legal and effective.

(2) The Company determines that the grant date of the 2024 Restricted Stock Incentive Plan complies with the relevant provisions of the Administrative Measures and the Incentive Plan and its summary regarding the grant date.

In summary, the Supervisory Board agreed that the grant date of the Company's 2024 Restricted Stock Incentive Plan would be July 7, 2024.

On February 2, it was agreed to grant 6.555 million to 316 incentive recipients at a grant price of RMB 26.15 per share.

shares of restricted stock.

Specific circumstances of (III) grant

1. Grant Date: July 2, 2024

2. Number of grants: 6.555 million shares, accounting for about 1.58 of the total 415.6376 million shares of the company at the time of the announcement of this incentive plan.

3. Number of grants: 316

4. Grant Price: 26.15 Yuan/Share

5, stock source: the company from the secondary market repurchase or/and the company's A- share common stock issued to the incentive target.

6, incentive plan validity period, vesting period and vesting arrangements.

(1) The validity period of this incentive plan shall not exceed 36 months from the date of grant of restricted stocks to the date when all restricted stocks granted to the incentive object are vested or invalid.

(2) After 12 months from the date of grant, and after the incentive object meets the corresponding vesting conditions, the restricted stock granted by this incentive plan will be vesting in accordance with the agreed proportion. The vesting date must be the trading day, but not within the following periods:

① Within 30 days prior to the announcement of the company's annual report or semi-annual report, if the announcement date is postponed due to special reasons,

From 30 days before the original appointment announcement to 1 day before the announcement;

② Within 10 days prior to the announcement of the company's quarterly report, performance forecast and performance bulletin;

③ From the date of occurrence of a major event that may have a significant impact on the trading prices of the Company's securities and their derivatives or in the process of decision-making, to the date of disclosure in accordance with the law;

④ Other periods specified by the CSRC and the Shanghai Stock Exchange.

The above-mentioned "material events" are transactions or other material matters that the Company shall disclose in accordance with the provisions of the Listing Rules. During the validity period of this incentive plan, if the provisions of the China Securities Regulatory Commission and the Shanghai Stock Exchange on the period during which directors, supervisors and senior managers of listed companies are not allowed to buy or sell shares of the company change, the restricted shares granted to the incentive objects of this incentive plan shall be implemented in accordance with the revised relevant regulations at the time of vesting.

The vesting period and vesting arrangements for restricted stock granted under this incentive plan are shown in the following table:

Vesting Arrangements Vesting Period Vesting Ratio

First Vesting Period From the first trading day after 12 months from the date of grant to 24 50% from the date of grant

The last trading day of the month.

The second vesting period is from the first trading day 24 months after the date of grant to the date of grant 36.

50% by the last trading day of the month

7, the list of incentive objects and award.

The number of restricted grants as a percentage of the number of grants.

Order Name, Nationality, Job Number of Stocks (10,000 Grant Restricted Incentive Plan

No.) the share capital of the total number of shares on the announcement date.

Proportion of Total Proportion

1. directors, senior management, core technical staff

1 Yu DeJian China Director, President 7.0 1.07 0.02

Hong Kong

2 Liu Jian China Executive Vice President, Core 5.5 0.84 0.01

Technical Staff

3 Radoje US Core Technical Personnel 5.5 0.84 0.01%

Drmanac

2. other incentive objects

Key business personnel (313) 637.5 97.25 per cent 1.53 per cent

Total 655.5 100.00% 1.58

Note: 1. The cumulative number of shares of the company granted by any of the above-mentioned incentive objects through all the equity incentive plans within the validity period does not exceed 1% of the company's total share capital. The total number of underlying shares involved in the incentive plan for the entire validity period of the company shall not exceed 20% of the total share capital of the company;

2. The incentive objects granted by this incentive plan do not include: independent directors and supervisors;

3. If the total number of values in the table does not match the sum of each sub-item value, it is due to rounding.

2. Supervisory Board's verification of the list of incentive targets

1. None of the incentive objects granted by this incentive plan shall not become incentive objects as stipulated in Article 8 of the Administrative Measures:

(1) It has been determined by the stock exchange as an inappropriate person within the last 12 months;

(2) It has been identified as an inappropriate candidate by the CSRC and its dispatched offices within the last 12 months;

(3) Administrative penalties or market bans imposed by the CSRC and its dispatched offices for major violations of laws and regulations in the last 12 months;

(4) with the "the People's Republic of China Company Law" shall not serve as a company director, senior management personnel;

(5) Laws and regulations shall not participate in the equity incentive of listed companies;

(6) Other circumstances determined by the CSRC.

2. The incentive objects of this incentive plan do not include independent directors, supervisors, shareholders or actual controllers who individually or collectively hold more than 5% of the company's shares, and their spouses, parents, and children.

3. The list of incentive objects granted by this incentive plan meets the qualifications stipulated in the the People's Republic of China Company Law, the People's Republic of China Securities Law and other laws, regulations and normative documents, as well as the articles of Association of Shenzhen Huada Zhizao Technology Co., Ltd., in line with the conditions of incentive objects stipulated in laws, regulations and normative documents such as the Administrative measures and listing rules, meet the incentive target conditions set out in the 2024 Restricted Stock Incentive Plan (Draft).

In summary, the Supervisory Board agrees with the list of incentive recipients granted by the Company under this Incentive Plan and agrees with the Company's 2024

The grant date of the restricted stock incentive plan is July 2, 2024, and it is agreed to use RMB 26.15 per share.

The grant price granted 6.555 million restricted shares to 316 incentive recipients.

If the 3. incentive object is a director or senior manager, it shall be sold six months before the restricted stock grant date.

A description of the company's shares.

The directors and senior management of the company granted this time did not sell the company's shares in the 6 months prior to the restricted stock grant date.

Accounting Treatment and Performance Impact Measurement of 4. Restricted Stock

The fair value of (I) restricted stock and the method of determining it.

With reference to the the People's Republic of China Department of Accounting, Ministry of Finance, "Application of Share-based Payment Standards-Grant of Restricted Stock", the measurement of share-based payments for Class II restricted stock is performed by reference to stock options. In accordance with the relevant provisions of AS 4-Share-based Payments and AS 22-Recognition and Measurement of Financial Instruments, the Company selects a Black-Scholes model to calculate the fairness of Class II restricted stock

value, and on July 2, 2024, the model was used to advance the 6.555 million Class 2 restricted shares granted.

line measurement. Specific parameters are selected as follows:

1. Underlying share price: 47.23 yuan/share (closing price on July 2, 2024);

2. The validity period is: 12 months and 24 months respectively (the period from the date of grant of Class II restricted stock to the vesting date of each period);

3, historical volatility: 13.17, 13.12 (using the Shanghai Composite Index in the last 12 months, 24, respectively.

monthly volatility);

4. Risk-free interest rate: 1.50 per cent and 2.10 per cent (using the benchmark interest rates for 1-year and 2-year deposits of financial institutions set by the People's Bank of China, respectively);

5. Dividend yield: 0.

The (II) expects the impact of the implementation of restricted stock on the operating results of each period.

The Company determines the fair value of the Class II restricted stock on the date of grant in accordance with accounting standards and related valuation tools, and ultimately recognizes the share-based payment expenses of this incentive plan, which will be amortized in proportion to the vesting arrangement during the implementation of this incentive plan. Incentive costs incurred by this Incentive Plan will be charged to recurring profit and loss.

In accordance with the requirements of Chinese accounting standards, the impact of the grant of restricted stock under this incentive plan on the accounting costs of each period is shown in the following table:

Total cost of expected amortization of number of grants 2024 2025 2026

(10,000 shares) (10,000 yuan) (10,000 yuan) (10,000 yuan) (10,000 yuan)

655.5 14,299.73 5,307.46 7,167.46 1,824.81

Note: 1. The above calculation results do not represent the final accounting cost, the actual accounting cost is related to the grant price and the number of vesting, and the actual number of vesting will be reduced accordingly if the incentive object leaves before vesting, the company's performance appraisal and the individual performance appraisal fail to meet the corresponding standards. At the same time, the company reminds shareholders of the possible dilution impact;

2. The final result of the above impact on the company's operating results will be subject to the annual audit report issued by the accounting firm.

The Company initially estimates, based on current information, that the amortization of restricted stock expenses has an impact on net income for each year of the validity period. But at the same time, the implementation of the restricted stock incentive plan will further enhance the cohesion of employees, team stability, and effectively stimulate the enthusiasm of the management team, thereby improving operating efficiency, reducing agent costs, and bringing higher operating performance to the company And intrinsic value.

5. Independent Financial Advisors

Shanghai Rongzheng Enterprise Consulting Services (Group) Co., Ltd., as an independent financial consultant, believes that as of the date of the report: the company's incentive plan adjustment and grant matters have obtained the necessary approval and authorization; the determination of the grant date, grant price, grant object and grant quantity of the restricted stock is in accordance with the provisions of laws, regulations and normative documents such as the Administrative Measures and the Listing Rules.

Concluding comments 6. counsel's legal opinion

1. This adjustment and this grant have obtained the necessary approvals and authorizations, in line with the "Administrative Measures for Equity Incentives for Listed Companies", "Shanghai Stock Exchange Science and Technology Innovation Board Stock Listing Rules", and "Science and Technology Innovation Board Listed Companies Self-Regulatory Guidelines No. 4-Disclosure of Equity Incentive Information" and "Shenzhen Huada Zhizao Technology Co., Ltd. 2024 Restricted Stock Incentive Plan (Draft)" relevant provisions;

2. The grant date, incentive object, grant quantity and grant price of this grant are in line with the relevant provisions of the measures for the Administration of Equity incentive of listed companies and the 2024 restricted Stock incentive Plan of Shenzhen Huada Zhizao Technology Co., Ltd. (draft); the grant conditions of this grant have been met, and the implementation of this grant by the company is in line with the measures for the Administration of Equity incentive of listed companies, the rules for the listing of Science and Technology Innovation Board of Shanghai Stock Exchange.

The relevant provisions of the 2024 Restricted Stock Incentive Plan of Shenzhen Huada Zhizao Technology Co., Ltd. (Draft);

3. The information disclosure obligations that the company has fulfilled comply with the "Administrative Measures for Equity Incentives of Listed Companies", "Shanghai Stock Exchange Science and Technology Innovation Board Stock Listing Rules", "Science and Technology Innovation Board Listed Companies Self-Regulatory Guide No. 4-Equity Incentive Information Disclosure", etc. The provisions of relevant laws, regulations, and regulatory documents; with the implementation of this incentive plan, the company still needs to continue to perform the corresponding information disclosure obligations in accordance with relevant laws, regulations, and regulatory documents.

7. Documents for Reference

1. "Resolution of the Seventh Meeting of the Second Board of Directors of Shenzhen Huada Zhizao Technology Co., Ltd.";

2. "Resolution of the Seventh Meeting of the Second Board of Supervisors of Shenzhen Huada Zhizao Technology Co., Ltd.";

3. Legal opinion of Beijing Junhe (Shenzhen) Law firm on matters related to the adjustment and grant of the 2024 restricted Stock incentive Plan of Shenzhen Huada Zhizao Technology Co., Ltd.

4, "Shanghai Rongzheng Enterprise Advisory Services (Group) Co., Ltd. on Shenzhen Huada Zhizao Technology Co., Ltd. 2024 restricted stock incentive plan adjustment and grant related matters of the independent financial adviser's report."

It is hereby announced.

Shenzhen Huada Zhizao Technology Co., Ltd.

Board of Directors

July 3, 2024