The board (the "Board") of directors (the "Directors") of the Haina Intelligent Equipment International Holdings Limited (the "Company", together with its subsidiaries, the "Group") announced that Zhejiang Haina Tongchuang Intelligent Technology Company Limited (the "Subsidiary"), an indirectly wholly-owned subsidiary of the Company and the Committee have entered into a legally binding agreement (the "Agreement") based on the Framework Agreement in relation to the Investment. Under the terms of the Agreement, the Company needs to establish an indirectly wholly-owned new foreign-invested company, Zhejiang Haina Zhihui Company Limited (the "Foreign-invested Company") and invest not less than USD 100 million, equivalent to approximately RMB 640 million, (the "Investment Amount"), into the Foreign-invested Company for construction and operation of a factory with a gross floor area of approximately 76,000 square meters, which will be principally engaged in the design and production of automated machines for manufacturing disposable hygiene products including adult diapers and sanitary napkins (the "Factory"). Approximately RMB 410 million of the Investment Amount shall be used for the acquisition of necessary fixed assets. The Investment Amount is payable by the Group within five years after the establishment of the Foreign-invested Company. The Board and the Committee are of the view that the Investment can bring numerous economic benefits to the area. As contemplated under the Agreement, the Subsidiary is required to acquire the land use rights of a designated land (the "Land") offered by the relevant local counterparts of the PRC government by way of bidding at auction (the "Acquisition"). The Committee is responsible for finishing the land formation and infrastructure works before the handover of the Land in order to facilitate the development and construction of the Factory. If the Land is not offered by the Committee within one year after the signing of the Agreement, the Agreement will be automatically terminated and lapsed and none of the parties to the Agreement shall have any claim against each other in respect of the Investment.