Hesai Group Supplemental Announcement on Continuing Connected Transactions with Sharpa

This filing provides a supplemental announcement regarding continuing connected transactions between Hesai Group and Sharpa, specifically concerning the Supply of Products Framework Agreement. The announcement details the pricing policy, stating that considerations for robotic actuators and manufacturing/support services will be determined on a cost-plus basis. The agreed margin rates are set within specific ranges: 40%-50% for robotic actuators and 35%-45% for manufacturing and support services. These ranges were determined through arm's length negotiation, referencing an independent transfer pricing analysis. The filing also outlines the basis for the annual cap, which was set with reference to the pricing policy, commercial assumptions, and the rationale for the transactions. Hesai Group has implemented internal control measures to ensure transactions are conducted fairly and within the agreed terms, including reviews by various departments, monitoring of the annual cap utilization, and annual reviews by independent directors and auditors. These measures aim to ensure transactions are in the ordinary course of business, on normal commercial terms, and fair to the company and its shareholders.