{"url_path":"/sec/hcai/10-k/2026/item-16g","section_key":"item-16g","section_title":"Item 16G Corporate Governance**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-13","source_url":"https://www.sec.gov/Archives/edgar/data/1958399/0001213900-26-055775-index.html","accession_number":"0001213900-26-055775","cik":"0001958399","ticker":"HCAI","issuer_name":"Huachen AI Parking Management Technology Holding Co., Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1958399/0001213900-26-055775-index.html","primary_entity_key":"0001958399","primary_entity_name":"Huachen AI Parking Management Technology Holding Co., Ltd"},"word_count":1010,"has_tables":true,"body_markdown":"**Item\n16G. Corporate Governance**\n\n \n\nAs a company listed on the\nNasdaq Capital Market, we are subject to the Nasdaq corporate governance listing standards. However, Nasdaq rules permit a foreign\nprivate issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the\nCayman Islands, which is our home country, may differ significantly from the Nasdaq corporate governance listing standards.\n\n \n\nOn\nMarch 31, 2025, we obtained an exemption letter from our Cayman counsel, Mourant Ozannes (Cayman)\nLLP, relying on Nasdaq Marketplace Rule 5615(a)(3), which allows foreign private issuers to follow\nhome country practice with respect to certain corporate governance requirements. Under the letter, we are entitled to be exempt from\nthe following rules of the Rule 5600 Series of the NASDAQ Stock Market LLC Rules:\n\n \n\n(i)Rule 5605(b)(1) of the Nasdaq Listing Rules, which we understand\nrequires that a majority of a company’s board of directors be comprised of independent directors.\n\n   \n\n(ii)Rule 5605(b)(2) of the Nasdaq Listing Rules, which we understand\nrequires that the independent directors of a company to have regularly scheduled meetings with only the independent directors present.\n\n   \n\n(iii)Rule 5605(e)(1) of the Nasdaq Listing Rules, which we understand\nrequires that director nominees must either be selected, or recommended for the board’s selection, either by (A) independent directors\nconstituting a majority of the board’s independent directors in a vote in which only independent directors participate, or (B) a\nnominations committee comprised solely of independent directors.\n\n   \n\n(iv)Rule 5620(a) of the Nasdaq Listing Rules, which we understand requires\nthat each company listing common stock or voting preferred stock, and their equivalents, hold an annual meeting of shareholders within\none year of the end of each fiscal year of the company.\n\n   \n\n(v)Rule 5620(b) of the Nasdaq Listing Rules, which we understand requires\nthat each company that is not a limited partnership shall solicit proxies and provide proxy statements for all meetings of shareholders\nand shall provide copies of such proxy solicitation to Nasdaq.\n\n   \n\n(vi)Rule 5620(c) of the Nasdaq Listing Rules, which we understand requires\nthat each company that is not a limited partnership shall provide for a quorum as specified in its by-laws for any meeting of the holders\nof common stock; provided, however, that in no case shall such quorum be less than 33 1/3 % of the outstanding shares of the company’s\ncommon voting stock.\n\n   \n\n(vii)Rule 5630(a) of the Nasdaq Listing Rules, which we understand requires\nthat each company that is not a limited partnership shall conduct an appropriate review and oversight of all related party transactions\nfor potential conflict of interest situations on an ongoing basis by the company’s audit committee or another independent body of\nthe board of directors.\n\n   \n\n(viii)Rule 5635(a) of the Nasdaq Listing Rules, which we understand requires\nthat shareholder approval be obtained in certain circumstances prior to an issuance of securities in connection with the acquisition of\nthe stock or assets of another company.\n\n   \n\n(ix)Rule 5635(b) of the Nasdaq Listing Rules, which we understand requires\nthat shareholder approval be obtained prior to the issuance of securities when the issuance or potential issuance will result in a change\nof control of the company.\n\n \n\n(x)Rule 5635(c) of the Nasdaq Listing Rules, which we understand requires\nthat shareholder approval be obtained prior to the issuance of securities when a stock option or purchase plan is to be established or\nmaterially amended or other equity compensation arrangement made or materially amended, pursuant to which stock may be acquired by officers,\ndirectors, employees, or consultants, subject to certain exceptions.\n\n \n\n(xi)Rule 5635(d) of the Nasdaq Listing Rules, which we understand requires\nthat shareholder approval be obtained prior to a 20% Issuance at a price that is less than the Minimum Price, where (a) “Minimum\nPrice” means a price that is the lower of: (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) immediately preceding\nthe signing of the binding agreement; or (ii) the average Nasdaq Official Closing Price of the common stock (as reflected on Nasdaq.com)\nfor the five trading days immediately preceding the signing of the binding agreement, and (b) “20% Issuance” means a transaction,\nother than a public offering as defined in IM-5635-3, involving the sale, issuance or potential issuance by the company of common stock\n(or securities convertible into or exercisable for common stock), which alone or together with sales by officers, directors or substantial\nshareholders of the company, equals 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance.\n\n \n\n91\n\n \n\nDespite\nbeing able to rely on these exemptions, we continue to adhere to certain Nasdaq corporate governance requirements, such as\nmaintaining a majority of independent directors on our board, conducting regular executive sessions attended solely by independent\ndirectors, and ensuring that our audit committee is comprised entirely of independent directors who meet the qualifications set\nforth in Rule 10A-3 under the Exchange Act. The only exemptions which we currently rely on are set out at points (iv), (viii), (ix),\n(x) and (xi) above, in which we follow our home country practice instead. Under Cayman Islands law, an exempted company is not\nrequired to conduct an annual meeting of shareholders unless otherwise provided by the company’s memorandum and articles of\nassociation. Additionally, shareholder approval is not generally required solely for a Cayman Islands company to issue new shares,\nprovided the issuance is within the company’s authorized share capital and is permitted by the company’s memorandum and\narticles of association. New share issuances are usually approved by board resolution, and our amended and restated articles of\nassociation governs the procedures and restrictions for share issuances.\n\n \n\nWe may, in the future, rely on other exemptions under Nasdaq rules to follow home\ncountry practices for additional corporate governance requirements. See “*Item 3. Key Information—D.\nRisk Factors—Risks Related to Our Capital Structure— Because we are a foreign private issuer and are permitted to adopt\ncertain home country practices in relation to corporate governance matters that differ significantly from the Nasdaq listing rules,\nyou will have less protection than you would have if we were a domestic issuer*.”"}