2026 Employee Stock Ownership Plan (Draft)

Stock Abbreviation: Yuanxiang New Material

Stock Code: 301300

Fujian Yuanxiang New Material Co., Ltd.

2026 Employee Stock Ownership Plan (Draft)

August 2026

Statement

The Company and all members of the Board of Directors guarantee that the contents of this Employee Stock Ownership Plan and its summary are true, accurate, and complete, with no false records, misleading statements, or major omissions.

Risk Warning

1. The 2026 Employee Stock Ownership Plan (Draft) of Fujian Yuanxiang New Material Co., Ltd. (hereinafter referred to as "Yuanxiang New Material," "the Company," or "this Company") (hereinafter referred to as "this ESOP Draft") can only be implemented after approval by the Company's general meeting of shareholders. There is uncertainty as to whether this ESOP Draft will be approved by the shareholders.

2. Specific details regarding the 2026 Employee Stock Ownership Plan (hereinafter referred to as "this ESOP"), such as funding sources, investment amounts, expected scale, and implementation plans, are preliminary results. There is uncertainty regarding whether they can be fully implemented.

3. If employee subscription funds are low, there is a risk that this ESOP cannot be established; if employee subscription shares are insufficient, there is a risk that this ESOP will fall below the expected scale.

4. Stock prices are influenced by various complex factors, including the Company's operating performance, macroeconomic cycles, international/domestic political and economic situations, and investor sentiment. Therefore, stock trading is an investment activity with certain risks, and investors should be fully prepared for this.

5. The descriptions of company performance assessment indicators in this ESOP do not represent the Company's performance forecasts and do not constitute performance commitments.

6. Investors are advised to make cautious decisions and be aware of investment risks.

Special Tips

The terminology used in this section is consistent with the "Definitions" section.

1. This ESOP Draft is prepared in accordance with the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Guiding Opinions on Pilot Projects for Employee Stock Ownership Plans of Listed Companies, the Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 2 — Standardized Operation of Companies Listed on the ChiNext Market, and other relevant laws, administrative regulations, rules, normative documents, and the Articles of Association.

2. This ESOP follows the principles of legality, compliance, voluntary participation, and risk-bearing, and there are no instances of forced participation such as apportionment or mandatory allocation.

3. Participants in this ESOP include the Company's (including subsidiaries) directors, senior management, core management personnel, and core technical (business) personnel (hereinafter referred to as "Holders"). The total number of participants at the initial establishment shall not exceed 55. The specific number and list of participants will be determined based on actual employee payments. The Management Committee may adjust the list of employees and allocation ratios based on subscription payments and employee turnover.

4. The source of shares for this ESOP is the A-share common stock of Yuanxiang New Material repurchased in the Company's dedicated repurchase account. The number of underlying shares intended to be held by this ESOP shall not exceed 1.2689 million shares, accounting for approximately 1.94% of the Company's total share capital of 65.429 million shares on the date of the announcement of this ESOP Draft. After this ESOP Draft is approved by the general meeting of shareholders, the Company will obtain the shares held in the dedicated securities repurchase account through non-transactional transfers or other methods permitted by laws and regulations. The status of the Company's share repurchases is as follows: