Analysis Report on the Feasibility of Issuing Convertible Bonds to Unspecified Targets (Revised Draft)

Table of Contents

1. Purpose and Necessity of Issuing Securities 2

(1) Type of Securities to be Issued 2

(2) Necessity of Selecting the Type of Securities to be Issued 2

1. Suitability of the Scope, Number, and Standards of Issuance Targets 4

(1) Suitability of the Scope of Issuance Targets 4

(2) Suitability of the Number of Issuance Targets 5

(3) Suitability of the Standards for Issuance Targets 5

1. Reasonableness of the Principles, Basis, Methods, and Procedures for Pricing the Issuance 5

(1) Reasonableness of the Principles for Pricing the Issuance 5

(2) Reasonableness of the Basis for Pricing the Issuance 7

(3) Reasonableness of the Methods and Procedures for Pricing the Issuance 7

1. Feasibility of the Issuance Method 8

(1) The Issuance Complies with the Relevant Regulations of the Securities Law on Issuing Convertible Bonds to Unspecified Targets 8

(2) The Issuance Complies with the Relevant Regulations of the Registration Administration Measures 9

(3) The Issuance Complies with the Relevant Provisions of the "Guiding Opinions on the Application of Article 9, Article 10, Article 11, Article 13, Article 40, Article 57, and Article 60 of the Measures for the Administration of Securities Offerings by Listed Companies — Securities and Futures Legal Application Opinions No. 18" (hereinafter referred to as "Securities and Futures Legal Application Opinions No. 18") 14

(4) The Issuance Complies with the Provisions of the "Memorandum of Understanding on Jointly Punishing Dishonest Persons Subject to Enforcement" and the "Memorandum of Understanding on Jointly Punishing Dishonest Customs Enterprises" 15

(5) The Procedures for Determining the Issuance Method are Legal and Compliant 15

1. Fairness and Reasonableness of the Issuance Plan 15

2. Impact of the Issuance on Immediate Returns and Measures to Compensate 15

3. Conclusion 16

1. Purpose and Necessity of Issuing Securities

(1) Type of Securities to be Issued

The type of securities to be issued by the Company in this issuance is convertible corporate bonds that can be converted into the Company's A-share shares (hereinafter referred to as "convertible bonds"). These convertible bonds and the Company's A-share shares that will be converted from these convertible bonds in the future will be listed on the ChiNext market of the Shenzhen Stock Exchange.

(2) Necessity of Selecting the Type of Securities to be Issued

The projects for which funds are raised through the issuance of convertible corporate bonds to unspecified targets have been carefully considered by the Company. The implementation of these projects will help to further enhance the Company's core competitiveness, strengthen its sustainable development capabilities, and achieve its strategic development goals. The issuance of convertible corporate bonds to unspecified targets is both feasible and necessary. The details are as follows:

1. Optimizing the Company's Shareholder Structure

As of now, the combined shareholding of the top three shareholders and the employee stock ownership plan is close to 70%. This high concentration of equity directly leads to insufficient liquidity in the Company's secondary market trading, which is not conducive to the entry of institutional investors and reduces the willingness of long-term institutional investors to allocate capital. Since its listing, the Company's operating performance has steadily improved, and its dividend distribution mechanism has been continuously implemented. Many institutional investors recognize the Company's high-quality operating performance. However, due to the current situation of high shareholding concentration by major shareholders, it is difficult for them to make long-term capital allocations to the Company.

By issuing convertible bonds to unspecified targets for public offering, and assuming the convertible bonds are subsequently converted into shares, the Company's total share capital will increase accordingly. The concentration of shares held by major shareholders will be effectively reduced, which will, on one hand, attract more institutional investors and long-term social capital, thereby optimizing the Company's shareholder structure. On the other hand, it will further strengthen the protection of the rights and interests of small and medium investors, truly realizing the goal of benefiting small and medium investors.