Hawthorne Huatong: Hawthorne Huatong (Changzhou) welding industry Co., Ltd.’s statement on the evolution of share capital since the establishment of the company and the confirmation opinions of its directors, supervisors and senior managers

Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd

Explanation on the evolution of share capital since the establishment of the company and the confirmation opinions of directors, supervisors and senior managers

Unless the context otherwise requires, the following words have the following meanings:

Harbin Welding Huatong, company and issuer refer to Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd

Huatong Co., Ltd. refers to Changzhou Huatong welding wire Co., Ltd., which is the predecessor of the issuer

Huatong welding industry refers to Changzhou Huatong Welding Industry Co., Ltd., which was the former name of the issuer before the reorganization in October 2015

Xiehe investment refers to Changzhou Xiehe equity investment center (limited partnership)

Hengtong investment refers to Changzhou Hengtong Investment Development Co., Ltd

Anjie Bahamas means Anjie Bahamas limited, amjay Corporation

Harbin Welding Institute refers to Harbin Welding Research Institute of Mechanical Science Research Institute, which is the predecessor of Harbin Welding Research Institute Co., Ltd

Harbin Welding Institute refers to Harbin Welding Research Institute Co., Ltd., which is the controlling shareholder of the company

China National Academy of Mechanical Sciences refers to China National Academy of Mechanical Sciences, which is the predecessor of China National Academy of Mechanical Sciences Group Co., Ltd

General Machinery Research Institute group refers to General Machinery Research Institute Group Co., Ltd., which is the actual controller of the company

The general meeting of shareholders refers to the general meeting of shareholders of Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd

The board of directors refers to the board of directors of Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd

The board of supervisors refers to the board of supervisors of Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd

This note refers to the statement of Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd. on the evolution of share capital since the establishment of the company

Note: unless otherwise specified, all values retain two decimal places. If the total number is inconsistent with the mantissa of the sum of the fractional values, it is caused by rounding.

1、 The formation and changes of the issuer’s share capital structure since its establishment

Since the establishment of the company, the evolution of share capital is as follows:

In May 1997, Huatong Co., Ltd. was established with a registered capital of 360000. Meiwujin container manufacturing factory invested and held 34.00% of the shares; Wujin huatongyuan welding wire Co., Ltd. holds 36.00%; Lin Yingfeng holds 30.00%. Shareholders make capital contributions in currency and physical assets

In September 1999, Wujin Huatong welding wire Co., Ltd. held

36.00% of the equity of Huatong Co., Ltd. was transferred to Wujin Xinhuachang welding Wujin container manufacturing factory, holding 15.69%; Wujin Xinhua Chang welding wire factory; The silk factory holds 57.64%; Lin Yingfeng holds 26.67%. The registered capital of the company increased from US $360000 to US $780000

In July 2002, Lin Yingfeng held 26.67% of Huatong Co., Ltd. and 15.69% of Wujin container factory; The equity of Wujin Xinhuachang welding was transferred to Anjie silk factory in Bahamas, holding 57.64%; Anjie Bahamas holds 26.67%

In September 2004, Changzhou Wujin container factory held 15.69% of Changzhou Wujin Xinhua Chang Cotton Textile Co., Ltd; 15.69% of the equity of Changzhou Huatong Co., Ltd. was transferred to Changzhou Wujin Xinhua Wujin Xinhua Chang welding wire factory, holding 57.64%; Anjie of Bahamas holds 26.67% shares of Chang Cotton Textile Co., Ltd

In August 2006, Changzhou Wujin Xinhua Chang Cotton Textile Co., Ltd. and Changzhou Wujin Xinhua Chang welding wire factory held 73.33% of the shares; Bahamian Ann transferred its 15.69% equity of Huatong Co., Ltd. to Changzhou jiejie, holding 26.67%

Wujin Xinhuachang welding wire Co., Ltd

Changzhou Wujin Xinhua Chang welding wire factory holds 73.33%; In April 2008, Bahamian Ann’s registered capital increased from US $780000 to 26.67% of Czech shares. This capital increase is made with monetary funds

$1.58 million

In April 2009, the registered capital increased from US $1.58 million to 92.34% held by Changzhou Wujin Xinhua Chang welding wire factory; Bahamas Ann 5.5 million U.S. dollars, Czech shares 7.66%. This capital increase is made with monetary funds.

In June 2011, Anjie of Bahamas gave all its equity to Changzhou Wujin Xinhua Chang welding wire factory, holding 92.34%; Comprehensive method holds the transfer, of which the capital contribution of US $14082800 is transferred to comprehensive method, with 2.56% shares; Pan Huaping holds 2.55%; Shan Suwen holds 2.55% of the shares, and the contribution of USD 14027900 is transferred to pan Huaping, and the contribution of USD 14027900 is transferred to Shan Suwen; When the registered capital of the foreign-funded enterprise is changed to USD 5.5 million by the people’s Bank of China, the actual exchange rate of the registered capital of the foreign-funded enterprise shall be converted to USD 5.5 million by the people’s Bank of China

The company took June 30, 2011 as the base date, and the audited book net asset value of RMB 1 Sicher Elevator Co.Ltd(301056) million, equivalent to the company’s shares, was changed into 65 million shares of the joint stock company in September 2011, The difference between net assets and share capital is 651056 4-3-2 million yuan, which is transferred into capital reserve

In November 2011, the registered capital of the company increased from 65 million yuan to Xiehe investment, and the capital was increased in the form of monetary capital.

Changzhou Wujin new 75 million yuan Huachang welding wire factory holds 80.03%; Xiehe investment holds 13.33%; Comprehensive method holding 2.22%; Pan Huaping holds 2.21%; Shan Suwen holds 2.21%

In October 2015, the company restructured its assets and changed its name to Harbin Welding Institute Changzhou Hengtong Investment Development Co., Ltd., holding 38.52%; Harbin Welding Institute Huatong (Changzhou) welding industry Co., Ltd. holds 29.34%; The General Research Institute of Mechanical Sciences holds 21.17%; According to the assessed value, the General Research Institute of machinery science holds 7.33% of the shares in cash and RMB; Comprehensive method holding 1.22%; Pan Huaping holds 26.41 million yuan and is transferred to Changzhou Hengtong Investment Development Co., Ltd. (former share: 1.21%; Shan Suwen holds 1.21%)

As the equity of 7.5 million shares of the company held by Changzhou Wujin Xinhua Chang welding wire factory); The General Research Institute of Mechanical Sciences subscribed for 213613 million additional shares issued by the company in cash of 752202 million yuan; Harbin Welding Institute subscribed 40.023 million shares of the company’s private placement with 100% equity of Weill company and the total evaluated value of net assets and fixed assets of solid welding wire division of 1408616 million yuan; Pan Huaping and Shan Suwen voluntarily gave up 1800 shares respectively.

Changzhou Hengtong Investment Development Co., Ltd. holds 38.52%; In December 2017, Shan Suwen held 29.34% of the company’s 1.21% shares; General Machinery Institute Group holds 21.17%; Xiehe investment right was transferred to Shan Xinghai, and pan Huaping held 7.33% of the company’s 1.21% capital; Comprehensive method holding 1.22%; Pan Chuanrong’s shareholding was transferred to pan Chuanrong by 1.21%; Shan Xinghai holds 1.21%

Pan Chuanrong, the former shareholder of the issuer, died in October 2019, and pan Chuanrong Changzhou Hengtong Investment Development Co., Ltd. holds 38.52%; Pan Huaping, daughter of Harbin Welding Institute, inherited 1655700 shares of the company held by her according to law, holding 29.34%; General Machinery Institute Group holds 21.17%; Concorde shares. On February 18, 2020, pan Huaping held 7.33% of the 165.57 capital of the company; Comprehensive method holding 1.22%; Zhang Yuqiang held 10000 shares and transferred them to his spouse Zhang Yuqiang. 1.21%; Shan Xinghai holds 1.21%

(I) Huatong Co., Ltd. was established in May 1997

The predecessor of the company is Changzhou Huatong welding wire Co., Ltd. (hereinafter referred to as “Huatong Limited”), which was jointly funded by Wujin container manufacturing plant, Wujin Huatong welding wire Co., Ltd. and Mr. Lin Yingfeng. It was registered in the State Administration for Industry and Commerce in May 30, 1997, and Mr. Lin Ying Feng, a shareholder of the company, is a natural person in Taiwan, China.

On April 19, 1997, Wujin container manufacturing plant, Wujin Huatong welding wire Co., Ltd. and Lin Yingfeng signed the contract of Changzhou Huatong welding wire Co., Ltd., and the three parties agreed on the total investment, registered capital and responsibilities of the parties to the joint venture. The registered capital of Huatong Co., Ltd. is US $360000, of which Wujin container factory invested US $122400 at the price of 1224 square meters, Wujin Huatong welding wire Co., Ltd. invested US $129600 at the price of equipment, and Lin Yingfeng invested US $108000 in spot exchange. On May 22, 1997, Wujin foreign economic relations and Trade Commission issued the reply on the contract and articles of association of Changzhou Huatong welding wire Co., Ltd. (wjzz (97) No. 014), agreeing to the contract, articles of association and agreement of Changzhou Huatong welding wire Co., Ltd. signed by Wujin container manufacturing plant, Wujin Huatong welding wire Co., Ltd. and Lin Yingfeng.

On May 23, 1997, the people’s Government of Jiangsu Province issued the approval certificate of foreign invested enterprises of the people’s Republic of China (WaiJingMao sufuzzi [1997] No. s28173).

On May 30, 1997, the State Administration for Industry and Commerce issued the business license for enterprise legal person (Qi He Su Chang Zong Fu Zi No. Holitech Technology Co.Ltd(002217) ), and the enterprise category is joint venture (Taiwan funded).

On June 12, 1997, Jiangsu Wujin Surui Certified Public Accountants issued the capital verification report (suwurui Huiyan (97) No. 306) to confirm the above capital contribution.

When Huatong Co., Ltd. was established, the shareholders and equity structure were as follows:

Serial number shareholder name contribution method

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