Jingce Electronics Holding Subsidiary Plans to Increase Capital and Introduce Investors Such as Shanghai Equipment Investment

On February 12, Jingce Electronics issued an announcement stating that its holding subsidiary Shanghai Jingjiwei Semiconductor Technology Co., Ltd. (hereinafter referred to as "Shanghai Jingjiwei") intends to introduce new investors in order to achieve further development, expand its scale and enhance its business capabilities. On February 11, 2022, Shanghai Jingjiwei signed the "Capital Increase Agreement" with new investors Shanghai Semiconductor Equipment and Materials Industry Investment Fund Partnership (Limited Partnership) (hereinafter referred to as "Shanghai Equipment Investment"), Shanghai Zhangjiang Suifeng Innovation Equity Investment Fund Partnership (Limited Partnership) (hereinafter referred to as "Zhangjiang Suifeng"), Shanghai Pudong Haiwang Integrated Circuit Industry Private Equity Fund Partnership (Limited Partnership) (hereinafter referred to as "Pudong Haiwang"), Haining Jinghai Equity Investment Partnership (Limited Partnership) (hereinafter referred to as "Haining Jinghai"), Shanghai Jingwang Enterprise Management Center (Limited Partnership) (hereinafter referred to as "Shanghai Jingwang"), Peng Qian and Shanghai Jingjiwei's original shareholder Shanghai Jingce Semiconductor Technology Co., Ltd. (hereinafter referred to as "Shanghai Jingce").

Shanghai Equipment Investment plans to invest RMB 25 million in Shanghai Jingjiwei, Zhangjiang Suifeng plans to invest RMB 25 million in Shanghai Jingjiwei, Pudong Haiwang plans to invest RMB 25 million in Shanghai Jingjiwei, Haining Jinghai plans to invest RMB 50 million in Shanghai Jingjiwei, Shanghai Jingwang plans to invest RMB 100 million in Shanghai Jingjiwei, Peng Qian plans to invest RMB 50 million in Shanghai Jingjiwei, and Shanghai Jingce plans to increase its investment in Shanghai Jingjiwei by RMB 25 million, totaling RMB 300 million, all of which will be included in the registered capital.

After the completion of this capital increase, Shanghai Jingce's equity ratio in Shanghai Jingjiwei changed from 100% to 21.43%. In view of the fact that Shanghai Jingwang and Mr. Peng Qian have signed the "Shareholder Voting Rights Entrustment Agreement" with Shanghai Jingce on February 11, 2022, respectively, agreeing to entrust Shanghai Jingce to exercise the voting rights, nomination rights and proposal rights corresponding to their equity in Shanghai Jingjiwei exclusively, free of charge and irrevocably, Shanghai Jingjiwei is still a company within the scope of the company's consolidated financial statements.

Shanghai Jingjiwei was established on May 12, 2021 with a registered capital of RMB 50 million. Its business scope includes general projects: technical services, technology transfer, technical consulting, and technology development in the fields of semiconductors, computers, display screens, photovoltaics, lithium batteries, new energy, testing equipment, and testing equipment.

The main financial indicators of Shanghai Jingjiwei in the most recent period (September 30, 2021): total assets of RMB 49,889,525.05, total liabilities of RMB 23,100,818.74, net assets of RMB 26,788,706.31, operating income of RMB 0, and net profit of RMB -13,211,293.69.

Jingce Electronics stated that given that Shanghai Jingjiwei is currently focusing on the research and development and production of related products in the field of bright-field wafer graphic defect detection equipment, this type of field has relatively long technical barriers and R&D cycles, and requires large amounts of capital. It is currently monopolized by overseas giant suppliers, and has certain risks from both the technical and market aspects. This time, the company gave up some of its preferential subscription rights and introduced different strategic partners to share risks, which will help it obtain sufficient funds to carry out the research and development and productization of related equipment in the semiconductor testing field, effectively reduce the investment risks and financial pressures of the company and Shanghai Jingce, and will be beneficial to the next stage of healthy development of Shanghai Jingjiwei. This capital increase is necessary for the normal business operations of Shanghai Jingjiwei.