*ST Xinyuan: Minority Shareholders Question Pre-Reorganization Pricing Imbalance, Board Secretary Claims Pricing is Reasonable

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Investor Question:

Dear *ST Xinyuan (Rights Protection) and Shenzhen Stock Exchange: As a small shareholder, I inquire about the severe imbalance in pre-restructuring pricing:

1. The industry side’s total cost is approximately 6.1 yuan per share (including a donation of 312 million + subscription of 420 million), bearing all restructuring risks;

2. The financial side only invests cash, subscribing to 142 million shares at 3.76 yuan per share, far below the industry side’s cost, with no commercial logic;

3. The low price and high issuance seriously dilute the rights of small and medium shareholders, does this involve benefit transfer;

4. Please adjust the financial side’s price to a reasonable and fair level to protect the interests of small and medium shareholders.

Secretary of the Board’s Response (*ST Xinyuan SZ300472):

Dear investor, hello! Thank you for your attention and questions. We understand your concern for the rights of small and medium shareholders. Here is an explanation of the relevant situation: To help mitigate the risk of delisting, industry investors and related parties have gratuitously donated cash assets to the company. This donation is unconditional, irrevocable, and without obligations. The financial investor, who signed the investment agreement on December 29, 2025, acquired shares at a price of 3.76 yuan per share. According to the “Guidelines for Supervision of Listed Companies No. 11—Matters Related to Bankruptcy and Restructuring of Listed Companies” issued by the China Securities Regulatory Commission, Article 8 states: “When a restructuring plan involves introducing restructuring investors, the relevant information of the restructuring investors, the number of shares they obtain, and the price must be clarified, and the purpose of the funds invested by the restructuring investors should be reasonably determined. The price at which restructuring investors obtain shares shall not be less than fifty percent of the market reference price. The market reference price is one of the average trading prices of the company’s stock over the 20, 60, or 120 trading days prior to the signing of the restructuring investment agreement.” The market reference price for the shares acquired by the financial investor is the average trading price of the company’s stock over the 120 trading days before the agreement, which is 6.52 yuan per share. The subscription and transfer prices of the shares by the financial investor are not less than 55% of this market reference price. The pricing of these shares complies with legal requirements, is fair and reasonable, and there is no harm to the company or small and medium investors during the introduction of investors. There is no benefit transfer involved. The progress of related matters has been disclosed in accordance with information disclosure rules. Please refer to the relevant announcements published by the company on designated information disclosure media. Thank you again for your understanding and support!

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