Statement of the Board of Directors of Changzhou Yingzhong Technology Co., Ltd. on the Transaction Complying with Article 11 and Not Applicable to Articles 43 and 44 of the Measures for Major Asset Reorganization of Listed Companies
Changzhou Yingzhong Technology Co., Ltd. (hereinafter referred to as the "Company" or "Listed Company") intends to acquire 51% of the equity of Changzhou Yingzhong Electric Co., Ltd. (hereinafter referred to as the "Target Company" or "Yingzhong Electric") held by Yu Biao, Yu Yingzhong, and Zhu Lihuan through cash payment (hereinafter referred to as the "Transaction").
The Company's Board of Directors hereby makes the following statement regarding the Transaction's compliance with Article 11 and non-applicability of Articles 43 and 44 of the "Measures for Major Asset Reorganization of Listed Companies" (hereinafter referred to as the "Restructuring Measures"):
I. The Transaction Complies with Article 11 of the "Restructuring Measures"
(I) Compliance with National Industrial Policies and Laws and Regulations on Environmental Protection, Land Management, Anti-monopoly, Foreign Investment, and Outbound Investment
- The Transaction Complies with National Industrial Development Requirements
The Transaction involves the proposed acquisition of 51% of the equity of Yingzhong Electric. Yingzhong Electric is primarily engaged in the research, development, production, and sales of insulating materials and molded products for power transmission and transformation equipment. According to the "Classification of National Economic Industries" (GB/T4754-2017) issued by the National Bureau of Statistics, the Target Company belongs to the "C38 Electrical Machinery and Equipment Manufacturing Industry" and its sub-sector "C3834 Insulating Products Manufacturing."
According to the "Classification of Strategic Emerging Industries (2018)" issued by the National Bureau of Statistics, Yingzhong Electric's main products fall under "New Energy Industry (6)," specifically "Smart Grid Industry (6.5)" within it, and further "Power Electronic Components Manufacturing (6.5.2)." Its key products and services include molded insulating parts for ultra-high and extra-high voltage AC and DC power transmission and transformation equipment. The industry in which the Company operates is a national strategic emerging industry.
According to the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)" issued by the National Development and Reform Commission, the business activities of the Target Company do not fall under industries restricted or eliminated by national industrial policies. Therefore, the Transaction complies with national industrial policies.
- The Transaction Complies with Laws and Regulations on Environmental Protection
On December 16, 2025, the Changzhou Municipal Ecology and Environment Bureau issued Administrative Penalty Decision (Chang Huan Zhong Xing Fa (2025) No. 12) to Changzhou Yingzhong Electric Co., Ltd., imposing a fine of 330,000 yuan for the environmental violation of installing a water pump in the ditch at the southwest corner of the "Ring-shaped Workshop" to pump accumulated water into the rainwater well at the southwest corner of the workshop, which was ultimately discharged into the municipal rainwater pipe network through the rainwater discharge outlet at the south gate of the factory.