On November 26th, Ningke Biotechnology announced that the company has signed an agreement with Shizuishan Zhengxing Chengxin New Materials Technology Partnership Enterprise (Limited Partnership) in 2022. According to the agreement, this partnership enterprise will transfer 10% equity of Ningxia Zhongke Biotechnology Co., Ltd. (referred to as “Zhongke New Materials”) to the company for a transfer price of 106 million yuan. As the company has not yet completed the payment for the equity transfer price, according to the agreement, the company shall bear a penalty for overdue payment at a rate of five ten-thousandths per day of unpaid amount until full payment is made by the company. In order to repay debts as soon as possible and reduce penalty costs, the company has signed a debt offset agreement with the partnership enterprise, transferring a property located in Huinong District, Huangjin Waterfront Talent Apartment Complex in Shizuishan City, Ningxia with an area of approximately 19,200 square meters and legally owned by Zhongke New Materials to offset part of the remaining equity transfer payment that has not been paid by the company. The transaction value of this related property is determined to be RMB 56.4989 million yuan. After completing matters related to debt offset agreements, there will still be sufficient apartments owned by Zhongke New Materials available to meet existing employee needs without significantly adverse effects on normal production operations and financial conditions of the company.