Flowing Cloud Technology Ltd. (FLOWING CLD-NEW) issued a supplemental announcement to its 26 May 2026 disclosure on the deemed disposal of equity in its indirect subsidiary, Hangzhou Zhongrunxing Information Technology Co. Ltd.

Key transaction details • Shareholding dilution: Beijing Flowing Cloud’s interest in Hangzhou Zhongrunxing falls from 87.50% to 72.42% after the combined effect of an earlier capital injection (the “Previous Subscription”) and the latest subscription (“the Subscription”). • New minority investors: Anhui Tongchuang and Lingshui Equity Fund now hold 10.34% and 6.90% respectively, while Beijing Dingli retains 10.34%. • Consolidation unchanged: Hangzhou Zhongrunxing continues to be a non-wholly owned subsidiary; its results and assets remain fully consolidated. The two new investors will be booked as non-controlling interests.

Background on Beijing Zhongrunxing • Ownership path: Ophyer Technology transferred its entire 92.31% stake in Beijing Zhongrunxing to Hangzhou Zhongrunxing on 10 December 2025. Lingshui Equity Fund still owns 7.69% pending a share-repurchase and cancellation expected by July 2026, after which Hangzhou Zhongrunxing will own 100%. • Financial snapshot (unaudited, 11 months to 30 Nov 2025): – Revenue: RMB3.03 million – Net loss: RMB8.08 million – Total assets: RMB15.84 million – Net liabilities: RMB0.88 million

Regulatory and ownership checks • Lingshui Equity Fund is 79.21% held by the Finance Bureau of Lingshui Li Autonomous County; all ultimate beneficial owners of Lingshui Equity Fund and Anhui Tongchuang are classified as Independent Third Parties. • Beijing Zhongrunxing’s business faces no PRC foreign-ownership restrictions, and its exclusion from existing contractual arrangements brings no material legal issues.

Enhanced compliance controls Flowing Cloud detailed a six-step internal control framework covering due diligence, size-test calculations, cross-department reviews, board escalation, and post-transaction monitoring. An external professional will conduct targeted Listing Rules training for directors and senior management, scheduled for August 2026.

All other information in the 26 May 2026 announcement remains unchanged. Shareholders and prospective investors are advised to exercise caution when trading the company’s shares.