Huadi International Group Co., Ltd.

Procedure for Implementing the Par Value Reduction

The Par Value Reduction constitutes a reduction of the share capital of the Company under section 14 of the Companies Act and, pursuant to Article 14.2 of the current amended and restated memorandum and articles of association of the Company, requires approval of the shareholders by special resolution. The Company proposes to effect the Par Value Reduction by special resolution supported by a solvency statement in accordance with section 14A of the Companies Act, rather than by confirmation of the Grand Court of the Cayman Islands. The directors of the Company will make the solvency statement no more than thirty (30) days before the date on which the special resolution is passed, and the Company will, following the passing of the special resolution, deliver to the Registrar of Companies of the Cayman Islands a copy of the solvency statement together with the minute of reduction.

Subject to and conditional upon the Par Value Reduction becoming effective, the amount by which the issued share capital of the Company is reduced pursuant to the Par Value Reduction will be credited to the share premium account of the Company.** **

Following the passing of the special resolution approving the Par Value Reduction (and concurrently with the filing of the resolutions approving the Share Capital Increase under Proposal (3)), the solvency statement, the minute of reduction and the resolutions approving the Par Value Reduction will be filed with the Registrar of Companies of the Cayman Islands. The Par Value Reduction will become effective upon the registration of the solvency statement and the minute of reduction by the Registrar of Companies of the Cayman Islands.

The affirmative vote of a majority of not less than two-thirds (2/3) of the votes cast by such shareholders as, being entitled to do so, vote in person or by proxy at the EGM is required. Unless otherwise instructed on the proxy or unless authority to vote is withheld, shares represented by executed proxies will be voted “FOR” this proposal. Abstentions or broker non-votes, if any, will not be counted as votes cast and will not affect the outcome of this proposal, although they will be counted for purposes of determining whether there is a quorum present.