I. Overview of this capital increase

1. The two wholly-owned subsidiaries of Shouhang High-tech Energy Technology Co., Ltd. (hereinafter referred to as the "Company" or "Shouhang High-tech"), a holding subsidiary of Xituo Energy Group Co., Ltd., intend to increase the registered capital:

(1) Hami Lijiang Energy Co., Ltd. (hereinafter referred to as "Hami Lijiang") decided to increase its registered capital by 45 million yuan due to the needs of business development. After the completion of this capital increase, the registered capital of Hami Lijiang will be increased from 10 million yuan to 55 million yuan.

(2) Hamilliha Energy Co., Ltd. (hereinafter referred to as "Hamilha"), due to the needs of business development, decided to increase the registered capital of 40 million yuan. After the completion of this capital increase, Hamilha's registered capital will be increased from 10 million yuan to 50 million yuan.

2. This capital increase has been reviewed and approved at the 15th meeting of the company's fourth board of directors. According to the "Articles of Association" and "Foreign Investment Management System" and other relevant regulations, this capital increase does not need to be submitted to the company's general meeting of shareholders for deliberation.

3. This capital increase does not involve connected transactions and does not constitute a major asset reorganization as stipulated in the Measures for the Administration of Major Asset Reorganization of Listed Companies.

II. Basic information on the subject company to be increased in capital

(I) Hami Lijiang Energy Co., Ltd.

1. Company Name: Hami Lijiang Energy Co., Ltd.

2. Date of Establishment: November 14, 2011

3. Place of registration: Room 904, Building 4, Xinxi Jiayuan, west of Bayi Road, Yizhou District, Hami City, Xinjiang

4. Legal Representative: Chen Shuangta

5. Registered capital: 10 million RMB

6. Business scope: compressor station tail gas waste heat power generation; photothermal power generation; energy power generation; power supply; heat production and supply; research and development, exchange and promotion of clean energy and energy-saving technologies; technology research and development in the fields of energy-saving equipment, solar energy and wind energy and sales of related equipment (projects subject to approval according to law can only be carried out after approval by relevant departments)

7, Relationship with the Company: Holding Sun Company

8. Key financial data indicators:

Main financial indicators	December 31, 2020 (in yuan)	March 31, 2021 (in dollars) (unaudited)
Total assets	96583774.12	97486365.8
Total liabilities	87513253.62	88447300.75
Net assets	9070520.5	9039065.05
Operating income	0	0
Total profit	-168363.9	-30864.86
Net profit	-166829.69	31455.45

 

(ii) Hamilliha Energy Company Limited

1. Company Name: Hamilliha Energy Co., Ltd.

2. Date of Establishment: October 26, 2011

3. Place of registration: Room 404, Building 7, Xinxi Jiayuan, West of Bayi Road, Yizhou District, Hami City, Xinjiang

4. Legal Representative: Chen Shuangta

5. Registered capital: 10 million RMB

6. Business scope: compressor station tail gas waste heat power generation; photothermal power generation; energy power generation; power supply; heat production and supply; research and development, exchange and promotion of clean energy and energy-saving technologies; technology research and development in the fields of energy-saving equipment, solar energy and wind energy and sales of related equipment

7, Relationship with the Company: Holding Sun Company

8. Key financial data indicators:

 

Main financial indicators	December 31, 2020 (in yuan)	March 31, 2021 (in dollars) (unaudited)
Total assets	140,070,449.81	141,217,088.73
Total liabilities	131,573,224.71	134,665,910.24
Net assets	8,497,225.10	6,551,178.49
Operating income	0.00	913,853.98
Total profit	-219,577.27	-2,002,224.20
Net profit	-218,966.95	-2,002,224.20

 

III. Purpose of the capital increase and its impact on the Company

This capital increase is to meet the needs of the future operation and development of the holding subsidiary Xituo Energy Group Co., Ltd., and the capital increase of its wholly-owned subsidiary is to support its business development and is in line with the company's strategic plan.

This capital increase belongs to the capital increase of the wholly-owned subsidiary of the holding subsidiary, the risk is controllable, will not adversely affect the company's financial and operating conditions, and there is no harm to the interests of the company and all shareholders.

After this capital increase, it will not lead to changes in the scope of the Company's consolidated financial statements and will not adversely affect the normal production and operation of the Company.

IV. Documents for Reference

1. Resolutions of the 15th Meeting of the Fourth Board of Directors.

It is hereby announced.

 

Shouhang Gaoke Energy Technology Co., Ltd.

Board of Directors

28 April 2021