Securities code: 688001 Securities abbreviation: Huaxing Yuanchuang Announcement No.: 2024-064

Suzhou Huaxing Yuanchuang Technology Co., Ltd

Announcement on Participation in the Establishment of Private Investment Funds

The board of directors and all directors of the company guarantee that there are no false records, misleading statements or material omissions in the content of this announcement, and assume legal responsibility for the authenticity, accuracy and completeness of its content in accordance with the law.

Important Content Notes:

Name and direction of investment fund: Suzhou Industrial Park Zhiyuan Micro New Venture Capital Partnership (Limited Partnership) (the final name is subject to the name registered by the market supervision and administration authority, hereinafter referred to as "Zhiyuan Micro New"), which mainly invests in the semiconductor industry chain, new materials, new energy and other industrial fields;

Investment amount, proportion and identity in the investment fund: Suzhou Huaxing Yuanchuang Technology Co., Ltd. (hereinafter referred to as "Huaxing Yuanchuang" or the "Company"), as a limited partner, subscribed for RMB10 million with its own funds, accounting for 16.64% of the fund share;

This investment is not a related party transaction and does not constitute a material asset restructuring;

Relevant Risk Warning:

1. The company's investment in Zhiyuan Weixin has no commitment to guaranteed capital and minimum returns, and its investment behavior is affected by various factors such as policies and regulations, macro economy, industry cycle, operation and management of investment targets, and there may be risks that it cannot achieve expected returns and cannot exit in a timely and effective manner;

2. The projects invested by the fund may also have different degrees of risks, including but not limited to market risk, management risk, liquidity risk, credit risk, risk of failure to realize expected investment returns, operational or technical risk and other risks;

3. Investing in private equity funds has the characteristics of long investment cycle and low liquidity, and will be affected by various factors such as macroeconomy, industry cycle, and operation and management of investment targets in the investment process, and there may be a risk that the investment project cannot achieve the expected returns due to major changes in decision-making or industry environment;

4. The company pays close attention to the follow-up progress of investment funds and business synergy opportunities, promotes the development of its main business through investment, and will fulfill its information disclosure obligations in a timely manner in accordance with the requirements of relevant laws and regulations such as the Rules for the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange, and please pay attention to investment risks.

1. Overview of matters related to participation in investment in private equity funds

On November 21, 2024, the company deliberated and passed the "Proposal on Participating in the Establishment of Private Equity Investment Funds". According to the resolution, the company participated in the establishment of Zhiyuan Micronew, and the fund manager and general partner are Suzhou Congrong Private Equity Fund Management Partnership (Limited Partnership), and the limited partners include: the company and Suzhou Dongwei Semiconductor Co., Ltd.

The initial subscription scale of KLCII was RMB60.1 million, of which RMB10 million was subscribed by the Company as a limited partner, accounting for 16.64% of the total subscribed capital contribution of the Fund. In this investment, the company did not promise a guaranteed return or exit guarantee to other investors. The investment does not constitute a related party transaction, nor does it constitute a major asset restructuring as stipulated in the Administrative Measures for the Material Asset Restructuring of Listed Companies, and does not need to be submitted to the general meeting of shareholders of the company for deliberation.

2. Basic information on private equity funds

(1) General partners, executive partners and fund managers

Suzhou Congrong Private Equity Fund Management Partnership (Limited Partnership) is the general partner and executive partner of KLCII, and acts as the fund manager, the basic information of which is as follows:

Company Name: Suzhou Congrong Private Equity Fund Management Partnership (Limited Partnership)

Registered address: 1st Floor, Building B, No. 388, Ruoshui Road, Suzhou Industrial Park

The subscribed amount is RMB50 million

Date of Establishment: June 11, 2015

Unified social trust

91320594339236522B with code

Investment management, investment consulting. (Projects subject to approval in accordance with the law can only be opened after approval by relevant departments.)

business activities)

Business Scope General Projects: Private Equity Investment Fund Management, Venture Capital Fund Management Services (Must be in China Securities

The Asset Management Association of Securities Investment can only engage in business activities after completing the registration and filing) (except for approval in accordance with the law).

In addition, independently carry out business activities with a business license in accordance with the law)

Suzhou Congrong Private Equity Fund Management Partnership (Limited Partnership) has completed the registration of private equity and venture capital fund managers with the Asset Management Association of China on September 18, 2015, with the registration number P1023548.

(2) Other major investors

Suzhou Dongwei Semiconductor Co., Ltd. (hereinafter referred to as "Dongwei Semiconductor") subscribed and contributed RMB 50 million as a limited partner of Zhiyuan Micronew. The basic situation of Dongwei Semiconductors is as follows:

Company name: Suzhou Dongwei Semiconductor Co., Ltd

Registered address: Room 515, Building 20, Northwest District, Suzhou Nano City, No. 99 Jinji Lake Avenue, Suzhou Industrial Park

The registered capital is 94,326,914 yuan

Date of establishment September 12, 2008

Unified social trust

91320594680506522G with code

Design and development of semiconductor devices, integrated circuits, chips, semiconductor consumables, and electronic products,

Business Scope Sales, import and export business and related technical consulting and technical services. (Items subject to approval in accordance with the law.)

business activities can only be carried out after approval by relevant departments)

Dongwei Semiconductors is a technology-driven semiconductor technology company, with deep technical accumulation in the field of devices as the core technology of semiconductors, focusing on semiconductor device technology innovation, and owning a number of core patents for semiconductor devices.

The company has no affiliation with the above-mentioned companies, the above-mentioned companies do not hold shares of the company directly or indirectly, there is no relevant interest arrangement with the company, and there is no arrangement that affects the interests of the listed company through a third party.

3. The basic situation of the investment fund

1. Name of the fund

Suzhou Industrial Park Zhiyuan Micro New Venture Capital Partnership (Limited Partnership) (tentative name, the final name shall be subject to the name registered by the market supervision and administration authority)

2. The establishment time, duration and exit mechanism of the fund

Suzhou Industrial Park Zhiyuan Micro New Venture Capital Partnership (Limited Partnership) is still in the process of being established and needs to complete the filing procedures with the Asset Management Association of China. The business period of KLCII's new industrial and commercial registration is 10 years. The operation period of the product is 7 years from the date of establishment of the partnership product, which can be extended upon the proposal and consent of the general partner.

The exit method of an investment fund may include, but is not limited to, listing, equity and/or transfer of proceeds, depending on the actual situation

Transfer, sale, repurchase, share exchange, liquidation or other ways in accordance with laws and regulations to achieve exit.

3. Fund subscription size and capital contribution structure

After the investment, the initial subscription scale of the fund will become RMB60.1 million, and the specific subscribed capital contribution structure is as follows:

Under:

Preface Name of Partner Type of Partner Subscribed Capital Contribution Subscribed Capital Contribution

No. (10,000 yuan) ratio

1 Suzhou Congrong Private Equity Fund Management Partnership General Partner 10 0.17%

(Limited Partnership)

2 Suzhou Dongwei Semiconductor Co., Ltd. Limited Partner 5,000 83.19%

3 Suzhou Huaxing Yuanchuang Technology Co., Ltd. Limited Partner 1,000 16.64%

Total - 6,010 100.00%

4. Main investment directions

semiconductor industry chain, new materials, new energy and other industrial fields.

5. Management Fees

During the operation of the product, the executive partner has the right to charge the limited partner a management fee rate of 2% per annum for the investment period and 1% per annum for the exit period, and no management fee for the extension period; The calculation base of the management fee (hereinafter referred to as the "calculation base") is: the paid-in capital contribution of the limited partner during the investment period; During the exit period, it is the total amount of investment principal (including related expenses) that has not been withdrawn in the current period. Management fees are paid on an annual basis. If there is a change in the total paid-in capital contribution of each limited partner / the total principal of the investment that has not been withdrawn during the year, the paid-in capital of each limited partner shall be paid in each quarter of the year

The maximum total amount of capital contributed (during the investment period) or the total amount of investment principal that has not been withdrawn in the current period (during the exit period) shall be adjusted, and the additional amount will be charged (during the investment period) or deducted or refunded in the management fee of the next period (during the exit period).

inside).

6. Management mode

The manager of Zhiyuan Micro is Suzhou Congrong Private Equity Fund Management Partnership (Limited Partnership).

KLCII employs a commercial bank with trusteeship qualifications and branches in Suzhou as the custodian of the partnership to register, effectively supervise and manage the capital contribution of the partnership and the income and income of the partnership, as well as more professional revenue and expenditure management, so as to ensure the safety of the partnership's funds and protect the legitimate rights and interests of each partner, and fulfill the relevant obligations of fund trusteeship.

KLCII has established a new investment decision-making committee. The Investment Committee consists of 3 members, 2 of whom are appointed by the Executive Partner and 1 by the Limited Partner Suzhou Dongwei Semiconductor Co., Ltd.

7. Profit model and income distribution

KLCII's revenue includes the following:

(1) Investment income received by the partnership after the disposal of any investment;

(2) dividend income from any one investment;

(3) the liquidity investment income of the partnership;

(4) Income from late fees and liquidated damages for overdue capital contributions arising from partners' overdue capital contributions;

(5) the amount of paid-in capital contribution that the partnership no longer invests or uses for other purposes and can be returned to the partners;

(6) Other cash income of the partnership.

The distributable income of the partnership under subparagraphs (1) to (3) above shall be actually distributed in the following order:

(1) First of all, the paid-in capital contribution of all partners will be returned. to the partnership in proportion to the partner's paid-in capital contribution

until the total amount of the partner's accrued distributions under paragraph (1) of this subsection is equal to his or her then-payment

the total amount of paid-up capital paid to the partnership;

(2) Secondly, the threshold income of 6%. If there is any surplus of investment income after distribution in accordance with paragraph (1) of this paragraph, the remaining part shall be distributed to each partner at the rate of 6% of the annualized (simple interest) income on the capital contributed by each partner;

(3) Then, 80/20 allocation. If there is a balance of investment income after distribution in accordance with paragraphs (1) and (2) of this paragraph, eighty percent (80%) of the remaining amount shall be distributed to each limited partner in proportion to its then-current paid-in capital contribution.

Twenty percent (20%) is distributed to the general partner.

The distributable income of the partnership under paragraphs (4) to (6) above shall not be distributed as the income of the investment project, and shall only be distributed to each partner in accordance with the proportion of its paid-in capital at that time when the income distribution of all investment projects is completed and the partnership still has residual income. For the avoidance of doubt, the late payment penalty for the late capital contribution of the partner can only be distributed among the non-defaulting partners according to the proportion of their paid-in capital contribution at that time.

8. Description of key personnel

The Company's directors, supervisors, senior managers, shareholders holding more than 5% of the shares, controlling shareholders and actual controllers of the Company, their directors, supervisors, senior management and other entities do not hold shares or subscribe for investment fund shares, and do not hold positions in Zhiyuan Micronew or fund managers.

9. Other Information

The company has not appointed personnel to the investment committee of Zhiyuan Micro and does not have the right of veto. As of the disclosure date of this announcement, Zhiyuan Micro has not invested in any foreign investment enterprises.

Fourth, the impact of this investment on the company

The funds established by the company are not included in the scope of the company's consolidated statements, and the source of investment funds is the company's own funds

The proportion of the capital contribution to the company's audited total assets in the latest year is 0.18%. This investment is in place to guarantee the owner of the company

The investment decisions made under the premise of normal business development will not affect the normal operation of the company's production and operation activities, will not have a significant impact on the company's annual operation and financial condition, and will not harm the interests of the listed company and all shareholders.

5. Risk analysis of this investment

1. The company's investment in Zhiyuan Weixin has no commitment to guaranteed capital and minimum return. Investment behavior is subject to policies, regulations, and macro economics

Under the influence of various factors such as economy, industry cycle, operation and management of investment targets, there may be a risk that the expected returns cannot be realized and the exit cannot be timely and effective;

2. The projects invested by the fund may also have different degrees of risks, including but not limited to market risks, management

He is at risk;

3. Investing in private equity funds has the characteristics of long investment cycle and low liquidity, and will be affected by various factors such as macroeconomy, industry cycle, and operation and management of investment targets in the investment process, and there may be a risk that the investment project cannot achieve the expected returns due to major changes in decision-making or industry environment;

4. The company will combine the general trend of national innovation-driven development and industrial transformation and upgrading, grasp the wave of industrial science and technology development, indirectly lay out strategic emerging industries and leading industries, accelerate the strategic synergy and deep integration of leading technology and high-quality business with the company's main business, and continue to empower the development of the company's main business. In accordance with the requirements of relevant laws and regulations such as the Rules for the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange, we will fulfill our information disclosure obligations in a timely manner, and please pay attention to investment risks.

The announcement is hereby made.

Board of Directors of Suzhou Huaxing Yuanchuang Technology Co., Ltd

November 22, 2024