Provisions of the Company Law on Equity Proportion

Legal subjectivity:

The shareholding ratio and the capital contribution ratio should be consistent. The articles of association can freely stipulate individual clauses such as inconsistent proportion of capital contribution and equity, inconsistent proportion of capital contribution and voting right, and different proportion of capital contribution and dividend. With the unanimous consent of all shareholders, such clauses belong to the consensus among shareholders, do not violate the mandatory provisions of laws and regulations, and are legal and effective. Article 34 of the Company Law stipulates that shareholders shall receive dividends in proportion to their paid-in capital contributions; When the company increases its capital, shareholders have the priority to subscribe for the capital contribution in proportion to the paid-in capital contribution. Except that all shareholders agree not to share the dividend according to the proportion of capital contribution or not to subscribe for the capital contribution in priority according to the proportion of capital contribution.

Legal objectivity:

Article 27 of the Company Law of People's Republic of China (PRC) * * * Shareholders may make capital contributions in cash, or in kind, intellectual property rights, land use rights and other non-monetary properties that can be valued in money and transferred according to law; However, except for the property that cannot be used as capital contribution as stipulated by laws and administrative regulations. Non-monetary property as capital contribution shall be evaluated and verified, and its value shall not be overestimated or underestimated. Where there are provisions in laws and administrative regulations on evaluation and pricing, those provisions shall prevail. Article 28 of the Company Law of People's Republic of China (PRC) * * * Shareholders shall pay their subscribed capital contributions in full and on time in accordance with the provisions of the Articles of Association. Where shareholders make capital contributions in cash, they shall deposit their capital contributions in full into the account opened by the limited liability company in the bank; Where non-monetary property is used as capital contribution, the formalities for the transfer of property rights shall be handled according to law. Where a shareholder fails to pay the capital contribution in accordance with the provisions of the preceding paragraph, he shall be liable for breach of contract to the shareholder who has paid the capital contribution in full and on time.