Xiangyao Announces Correction: Board Resolution on Private Placement of Common Shares for Cash Increase

1. Board Resolution Date: 115/04/24

2. Type of Privately Placed Securities: Common Shares

3. Recipients of Private Placement and Their Relationship with the Company: The private placement shall be limited to specific qualified investors as defined under Article 43-6 of the Securities and Exchange Act and related regulations, and shall be restricted to strategic investors. Priority will be given to investors who can generate tangible benefits for the company’s long-term development, business expansion, financial structure improvement, competitiveness enhancement, and existing shareholders’ interests. However, no specific investors have been finalized at this stage. The eligibility criteria and selection of investors will be submitted to the shareholders’ meeting for authorization to the board for legal review and execution.

4. Number of Shares to be Privately Placed: Up to 7,000,000 shares

5. Available Private Placement Quota: Up to 7,000,000 shares, to be conducted in two tranches within one year from the shareholders’ meeting resolution date

6. Basis and Reasonableness of Private Placement Pricing: The reference price for private placement is determined by the higher of the following two benchmarks: (1) The simple arithmetic average of the closing prices of common shares over one, three, or five trading days prior to the pricing date, adjusted by deducting the effects of bonus issues and dividends, and adding back the effects of capital reduction. (2) The simple arithmetic average of the closing prices of common shares over the 30 trading days prior to the pricing date, adjusted by deducting the effects of bonus issues and dividends, and adding back the effects of capital reduction.

The actual private placement price for common shares shall not be lower than 80% of the reference price. This pricing method complies with current regulations and considers the company’s operational status, future outlook, market price of common shares, market practices, and the transfer restrictions on privately placed securities, and is therefore deemed reasonable. The actual pricing date and final private placement price, within the minimum threshold approved by the shareholders’ meeting, will be determined by the board in accordance with applicable laws, based on the outcome of investor negotiations and capital market conditions.

7. Use of Proceeds from the Private Placement: To strengthen working capital, repay borrowings, improve financial structure, and meet future funding needs arising from business development.

8. Reason for Not Conducting a Public Offering: Considering timeliness, convenience, feasibility, and issuance costs, private placement offers a swift and efficient method. Additionally, the transfer restrictions on privately placed securities help ensure a stable, long-term relationship between the company and strategic investors. Therefore, the company has decided to proceed via private placement.

9. Dissenting or Reserved Opinions from Independent Directors: None

10. Actual Pricing Date: Not applicable

11. Reference Price: Not applicable

12. Actual Private Placement Price, Conversion Price, or Subscription Price: Not applicable

13. Rights and Obligations of the Newly Issued Privately Placed Shares: The rights and obligations of the privately placed common shares are identical to those of the company’s currently issued common shares. However, under the Securities and Exchange Act, the privately placed common shares may not be resold for three years from the date of delivery, except to transferees permitted under Article 43-8 of the Act. After three years from the delivery date, the board is authorized to apply to the competent authority for supplementary public offering and listing, subject to prevailing conditions.

14. Share Conversion Benchmark Date (if applicable): Not applicable

15. Potential Dilution Impact (if applicable): Not applicable

16. Impact on Listed Common Shareholding Ratio upon Full Conversion (if applicable): Not applicable

17. Measures for Low Liquidity if Listed Shares Less Than 60 Million or 25%: Not applicable

18. Other Matters to be Disclosed: (1) The main content of this private placement plan, excluding the pricing discount ratio, including issuance price, number of shares, amount raised, project details, fund utilization progress, expected benefits, and other unspecified matters, may be revised in the future due to regulatory requirements or changes in objective circumstances. Such revisions will be submitted to the shareholders’ meeting for authorization to the board to handle in accordance with relevant regulations. (2) The original announcement incorrectly omitted the detail in Point 5 ('Available Private Placement Quota') that the offering will be conducted in two tranches within one year from the shareholders’ meeting resolution date. This is hereby corrected. (3) The original announcement erroneously included content in Point 10 ('Actual Pricing Date'), Point 11 ('Reference Price'), and Point 12 ('Actual Private Placement Price, Conversion or Subscription Price'). As no actual pricing has yet occurred, the actual pricing date, reference price, and private placement price will be determined by the board after shareholders’ meeting approval, in accordance with the resolution and relevant laws. This is hereby corrected.