Xiamen Songlin Technology Co., Ltd. Progress Announcement on Using Part of Idle Raised Funds for Cash Management

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Stock code: 603992 Stock abbreviation: Songlin Technology Announcement No.: 2026-032

Xiamen Songlin Technology Co., Ltd.

Progress Announcement on the Use of Some Temporarily Idle Proceeds for Cash Management

The board of directors of this company and all directors hereby guarantee that this announcement contains no false records, misleading statements, or material omissions, and assume legal responsibility for the authenticity, accuracy, and completeness of the contents of this announcement.

Key Points in This Announcement:

● Types of cash management products in this transaction: demand deposits, bank structured deposits

● Counterparty in this transaction: Industrial Bank Xiamen Wenbin Sub-branch

● Investment amount in this transaction: RMB 83.00 million

● Redemption amount in this transaction: RMB 95.00 million

● Approved deliberation procedures completed:

Xiamen Songlin Technology Co., Ltd. (hereinafter referred to as the “Company”) was approved at the 25th meeting of the third session of the board of directors for the “Proposal on the Company’s Use of Idle Proceeds for Cash Management,” under which the Company agreed to use temporarily idle proceeds with a maximum amount not exceeding RMB 220.00 million (inclusive). Under the premise of ensuring the Company’s daily operating fund needs and fund safety, the Company will use the temporarily idle proceeds to purchase products with high safety and good liquidity to increase investment returns. The utilization period is valid within 12 months from the date the board’s approval is obtained. The Company may recycle and use within the aforementioned limits and time period. The sponsor issued a no-objection verification opinion on this matter.

● Special risk warning: Although the product types used by the Company for cash management of temporarily idle proceeds are limited to products with high safety, good liquidity, and a product term not exceeding 12 months—therefore, the overall risk is controllable—financial markets are greatly affected by macroeconomic conditions. Purchasing wealth management products may involve market risk, liquidity risk, credit risk, and other risks. The Company will timely, appropriately and in measured amounts participate based on market conditions and changes in the financial markets; therefore, the actual returns of short-term investments may be uncertain.

I. Details of the redemption of wealth management products purchased with idle proceeds in this transaction

Recently, the Company redeemed, at the Industrial Bank Xiamen Wenbin Sub-branch, the structured deposits and demand deposits purchased in the previous period with temporarily idle proceeds of RMB 95.00 million. The principal and the proceeds generated from the proceeds have been fully received, and have been deposited in the special account for proceeds. Details are as follows:

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II. Overview of the cash management to be conducted in this transaction

(I) Investment purpose

To improve the utilization efficiency of the Company’s idle proceeds, under the premise of ensuring the Company’s daily operating fund needs and fund safety, the Company uses idle proceeds to purchase products with high safety and good liquidity, thereby increasing investment returns.

(II) Investment amount

The amount of cash management using temporarily idle proceeds in this transaction is RMB 83.00 million.

(III) Sources of funds

1. General situation of the sources of funds

The sources of funds for this cash management of the Company are temporarily idle proceeds from the Company’s publicly issued convertible corporate bonds in 2022.

2. Basic information of the proceeds

Upon approval by the China Securities Regulatory Commission’s “Reply on Approving the Public Issuance of Convertible Corporate Bonds by Xiamen Songlin Technology Co., Ltd.” (CSRC Approval [2022] No. 1240), and with the Shanghai Stock Exchange’s consent, the Company publicly issued 6.10 million lots of convertible corporate bonds to the public, with a par value of RMB 100 per lot. The total proceeds amount was RMB 610M. After deducting underwriting fees and sponsorship fees of RMB 7M (excluding tax), the actual amount received was RMB 603M. In addition, after deducting external expenses directly related to the issuance, including audit fees, capital verification fees, law firm fees, credit rating fees, issuance handling fees, and information disclosure for this issuance of convertible corporate bonds, totaling RMB 2.19M, the net proceeds from issuance were RMB 600.81M. The net proceeds were received and in place on July 26, 2022. Tianjian Certified Public Accountants (Special General Partnership) verified and issued the Tianjian Verification [2022] No. 384 verification report. The Company, in accordance with relevant regulations, adopted special account storage management for the proceeds, and entered into a tripartite regulatory agreement with the sponsor and the bank that regulates the special account for proceeds. For specific details, please refer to the “Announcement on the Listing of Publicly Issued Convertible Corporate Bonds” disclosed on August 15, 2022 on the website of the Shanghai Stock Exchange (www.sse.com.cn).

On September 11, 2024, the 12th meeting of the third session of the board of directors and the 12th meeting of the third session of the board of supervisors of the Company considered and approved the “Proposal on Changing the Investment Projects of the Proceeds.” The “Songlin Convertible Bond (松霖转债)” 2024 First Bondholders’ Meeting and the 2024 First Extraordinary General Meeting of Shareholders held on September 27, 2024 approved the aforementioned proposal. Based on the Company’s own strategic planning, the Company changed its original project funded by proceeds, “Beauty & Health and Expansion and Technological Renovation of Shower Fixtures Project,” to the “Phase I Construction Project of the Vietnam Production Base.” The implementation entity changed from the Company and Zhangzhou Songlin Smart Home Co., Ltd. (hereinafter referred to as “Zhangzhou Songlin Company”) to Songlin Technology (Vietnam) Co., Ltd. (hereinafter referred to as “Songlin Vietnam Company”). The Company plans to use proceeds to make additional capital contributions to the entity implementing the projects funded by proceeds in order to carry out the projects funded by proceeds. In order to implement the specific new projects funded by proceeds and to standardize the Company’s management and use of the proceeds, the Company, Songlin Vietnam Company, the sponsor, and Industrial Bank (Xiamen Wenbin Sub-branch) signed the “Four-Party Regulatory Agreement on the Special Account Storage of Proceeds.” The Company, Songlin Vietnam Company, the sponsor, and the Ho Chi Minh City Branch of China Construction Bank Co., Ltd. signed the “Four-Party Regulatory Agreement on the Special Account Storage of Proceeds.” The provisions of the agreements do not have any material differences from the model text of the tripartite regulatory agreement of the Shanghai Stock Exchange. When using the proceeds, the Company has strictly complied with and performed the relevant requirements.

(IV) Implementation method

The basic information of the cash management using idle proceeds in this transaction is as follows:

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For the investment products to be used in this transaction with temporarily idle proceeds, the quota, term, method of profit distribution, and investment scope meet the requirements for use conditions characterized by high safety and good liquidity. There is no act of indirectly changing the use of the proceeds, and it does not affect the normal progress of the projects funded by proceeds.

As of December 31, 2025, the Company’s monetary funds were RMB 949.03M. The cash management amount using idle proceeds in this transaction accounts for 8.75% of the Company’s monetary funds at the end of the most recent period, 2.49% of the Company’s net assets at the end of the most recent period, and 1.85% of the Company’s total assets at the end of the most recent period.

(V) Investment term

The Company strictly follows the prudent investment principle and conducts investments within the cash management quota authorized by the board of directors, with investment terms not exceeding 12 months.

III. Deliberation procedures

On October 29, 2025, the 25th meeting of the third session of the board of directors approved the “Proposal on the Company’s Use of Idle Proceeds for Cash Management.” The Company agreed that the Company and its subsidiaries, while ensuring the safety of proceeds and not affecting the normal implementation of the investment plan for proceeds, would use idle proceeds not exceeding RMB 220.00 million (inclusive) for cash management, investing in products such as structured deposits and large-denomination certificates of deposit that have high safety, good liquidity, and a product term not exceeding 12 months. The management is authorized to make investment decisions and organize implementation.

This matter does not require submission to the general meeting of shareholders for consideration, and does not involve related-party transactions.

IV. Investment risks of cash management and risk control measures

(I) Investment risks

Although the product types used by the Company for cash management of temporarily idle proceeds are limited to products with high safety, good liquidity, and a product term not exceeding 12 months—therefore, overall risk is controllable—financial markets are greatly affected by macroeconomic conditions. Purchasing wealth management products may involve market risk, liquidity risk, credit risk, and other risks. The Company will timely, appropriately and in measured amounts participate based on market conditions and changes in financial markets; therefore, the actual returns of short-term investments may be uncertain.

(II) Risk control measures

When the Company and its subsidiaries use idle proceeds for cash management, they select investment products that meet: (1) products with high safety such as structured deposits and large-denomination certificates of deposit; they must not be non-principal-protected products; (2) good liquidity and a product term not exceeding twelve months; (3) cash management products without pledge conditions. Although the risk is controllable, financial markets are greatly affected by macroeconomic conditions, and it cannot be ruled out that the investment may be affected by market fluctuations. The Company takes the following internal control measures for risks related to entrusted wealth management:

1. The Company will continuously improve its internal control system for investment and wealth management, maintain a prudent investment philosophy, and appropriately adjust the investment portfolio in light of external circumstances such as the economic situation.

2. The Company’s management and relevant financial personnel will continuously track the destinations of the investment products and the progress of the projects, and will promptly take corresponding preservation measures to control investment risks. If major adverse factors such as deterioration in the financial position of the product issuing entity or losses facing the invested products occur, the Company will timely disclose announcements and, to the maximum extent, protect the safety of funds.

3. The Company’s cash management will be implemented only through special settlement accounts for proceeds or through product-specific settlement accounts publicly disclosed.

4. The Company’s audit department will supervise and verify the use of funds, and if necessary will engage professional institutions to conduct an audit.

5. The Company strictly complies with relevant laws and regulations and fulfills information disclosure obligations.

V. Impact of the investment on the Company

(I) Impact on the Company

The Company’s use of part of temporarily idle proceeds for cash management in this transaction is carried out on the premise of ensuring that the normal use of proceeds is not affected and that risks are effectively controlled, and it will not affect the implementation of the projects funded by proceeds. Through conducting appropriate, low-risk investment and wealth management, the Company can improve the efficiency of proceeds utilization, further increase the Company’s returns, and is in the interests of all shareholders.

(II) Accounting treatment

In accordance with relevant provisions such as “Enterprise Accounting Standards No. 22—Recognition and Measurement of Financial Instruments” and other related regulations, the Company will perform corresponding accounting treatment for the cash management business of proceeds. The treatment will be reflected in relevant line items in the statement of financial position and the income statement; the specific treatment shall be subject to the annual audit results.

VI. As of the date of this announcement, the Company’s cash management using proceeds over the past twelve months

Unit: RMB ten thousand

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Note:

1. The statistical period for the last 12 months is from April 1, 2025 to March 31, 2026. The amounts above represent the total combined amount of newly entrusted wealth management of idle proceeds over the last 12 months.

2. If the sum of the actual returns in the table differs in the last digits from the sum of the values in each sub-item, it is due to rounding.

Announcement is hereby given.

Board of Directors of Xiamen Songlin Technology Co., Ltd.

April 2, 2026

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