Graphex Group will be separating its U.S. graphite processing arm - Graphex Technologies LLC - as a U.S. domiciled independent player in the market as a stand-alone company, with anticipated stock consideration of US$100 million to US$200 million paid by a SPAC from the business combination transaction to be distributed to all Graphex Group shareholders.

Graphex Group Limited (“Graphex Group” or the “Company”) (NYSE American: GRFX | HKSE: 6128), together with its wholly owned U.S. subsidiary, Graphex Technologies, LLC (Graphex Tech), see the recent steps being taken by the governments of the US and China as validation of Graphex’s long-standing strategy to expand operations globally and to create separate, domestic end-to-end production ecosystems – from mine to battery – to serve both markets.

With over a decade of commercial scale production experience and proven proprietary technology and methods, the expansion in both the U.S. and China is expected to be seamless.

As of December 18, 2023, the global market capitalization of Graphex Group was approximately US$42.622 million.

Our current maximum annual production capacity is 10,000 tonnes per annum (tpa) of anode material, all processed in China.

U.S. Operations Separation

• On December 6, 2023, Graphex Group announced the signing of an LOI with a NASDAQ-listed SPAC
• The LOI contemplates a pre-money enterprise valuation of Graphex Technologies, Graphex Group’s US operating arm, net of liabilities, between US$100 million to US$200 million
• Upon the completion of the intended transaction with the SPAC, the anticipated consideration of US$100 million to US$200 million in consideration shares for the separation of Graphex Tech will be distributed to all Graphex Group shareholders.
• Upon completion of the transaction, Graphex Tech will be its own, stand-alone entity independent of Graphex Group

More information on Graphex Tech and this U.S. initiative will follow in a separate corporate update

Production Expansion Update

• Current graphite anode production capacity - 10,000 tpa
• LOI from a major bank in China for project financing of RMB400 million (US$56.5 million) to complete first expansion phase in Qingdao, Shandong, PRC
• First expansion phase expected to complete in Q3 2024 and increase capacity by 200% to 30,000 tpa
• Second expansion phase expected to be completed by the end of 2025 and increase capacity by an additional 30,000 tpa to 60,000 tpa
• Expansion expected to unlock substantial growth driven by increasing demand for graphite materials used in lithium battery production
• Additional expansion plans in place to reach over 100,000 tpa before 2030

More information on Graphex Group and the China expansion initiative will follow in a separate corporate update

To learn more about Graphex Technologies, please visit www.graphexgroup.com.

About Graphex

Graphex is a multinational technology company focused on the development of technologies and products to enhance renewable energy, particularly the refining of natural spherical graphite, synthetic graphite, and graphene-related products - key components in EVs/Lithium-ion batteries as well as in other uses. Graphex has extensive commercial experience in the deep processing of graphite and producing battery grade graphite anode material. Current production is 10,000 tonnes per annum (tpa) with a current expansion underway to increase production to 30,000 tpa within the next 9 months, to 100,000 tpa over the next 36 months, and to 150,000 tpa or more by 2030. Graphex is currently among the top suppliers of specialized graphite anode material to the EV and renewable energy industries and holds patents in areas including products, production methods, machinery design, and environmental protection. Graphex’s strategy is to expand its operations globally to support energy transition and electrification efforts worldwide.

To learn more about Graphex Technologies, please visit www.graphexgroup.com.

Forward Looking Statements

All statements contained in this presentation other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans and our objectives for future operations, are “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the safe harbor in Section 27A and 21E of the Securities Act of 1933 and the Securities Exchange act of 1934, respectively. You can identify some of these forward looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “likely,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. We have based these forward looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short term and long-term business operations and objectives, and financial needs. These forward looking statements involve various risks and uncertainties. Information from third sources identified in this release is based on published reports for such information and we have assumed the accuracy of such reports without independent investigation or inquiry. This communication is for informational purposes only and is neither an offer to sell nor a solicitation of an offer to purchase any securities of Graphex Group Limited, including but not limited to its American Depositary Shares.

Each of the transactions described in this press release is subject to conditions including the negotiation and execution of definitive agreements and, regarding the separation of Graphex Technologies, stockholder consent and regulatory approvals. There can be no assurance that either transaction will be completed on acceptable terms or at all.

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