Baoding Tianwei Baobian Electric Co., Ltd. Announcement on related party transactions for the acquisition of real estate

Stock code: 600550 Securities abbreviation: Baobian Electric Announcement number: Pro 2021-008

The Board of Directors and all Directors of the Company warrant that the contents of this announcement are free from any misrepresentation, misleading statement or material omission and accept sole and several liability for the truthfulness, accuracy and completeness of the contents.

Important Content Tips:

● Transaction content: Baoding Tianwei Baobian Electric Co., Ltd. acquired 5 real estate properties held by Baoding Tongwei Electrical Equipment Co., Ltd

● The transaction did not constitute a material asset restructuring

I. Overview of Related Party Transactions

The 35th meeting of the 7th Board of Directors of Baoding Tianwei Baobian Electric Co., Ltd. (hereinafter referred to as "the Company" or "Baobian Electric") deliberated and passed the "Proposal on the Acquisition of Part of the Real Estate of Baoding Tongwei Electrical Equipment Co., Ltd.", in order to realize the integrity of the ownership of assets, the Company decided to acquire 5 real estates held by Baoding Tongwei Electrical Equipment Co., Ltd. (hereinafter referred to as "Tongwei Company") at a price of 5.6841 million yuan. The related party transaction does not constitute a material asset restructuring as stipulated in the Measures for the Administration of Material Asset Restructuring of Listed Companies.

The Company is a wholly-owned subsidiary of China North Industries Equipment Group Co., Ltd. (hereinafter referred to as "Bing equipment group"), the controlling shareholder of the Company, and the transaction constitutes a related party transaction.

Up to this related party transaction, in the past 12 months, the related party transactions related to the same related person or the transaction category between the company and different related parties have not reached more than 30 million yuan, and account for more than 5% of the absolute value of the company's latest audited net assets. The transaction does not need to be approved by the general meeting of shareholders.

2. Introduction of related parties

Company Name: Baoding is also electrical equipment limited

Residence: No. 2399, Tianwei West Road, Baoding City

Legal representative: Wen Hong

Registered capital: 50 million yuan;

Type of company: Limited liability company (wholly owned by a legal person not invested or controlled by a natural person);

Date of Establishment: September 10, 2013;

Business scope: transmission and distribution equipment and related control equipment, wire and cable, electronic and electrical machinery special equipment, instrumentation manufacturing, sales, consulting, maintenance and transformation, insulation products sales. Electrical product technology development, consulting, technology promotion services; self-operated and agent of export commodities other than the state organization unified joint operation of export commodities and the state to implement the approval of the company's operation of import commodities other than import business import business. (Projects that are required to be reported for approval by laws, administrative regulations or decisions of the State Council are not allowed to operate until approval is obtained).

As of December 31, 2019, the company had audited total assets of RMB1,710.66 million, net assets of RMB589.97 million, total liabilities of RMB2,300.63 million, operating income of RMB1,058.09 million, net profit of RMB46.44 million and an asset-liability ratio of 134%. As of September 30, 2020, the Company had total unaudited assets of RMB1,340.6 million, net assets of -RMB617.4 million, total liabilities of RMB1,957.99 million, operating income of RMB717.73 million, net profit of RMB14.93 million and an asset-liability ratio of 146%.

3. The basic situation of the subject matter of the related party transaction

(1) The subject matter of the transaction

1. The name and category of the transaction

The subject of the transaction is the old office building under the same company-owned BaofangZi No. 20000151, the steel plate is treated, the 250T gantry oil pump room and the fuel tank room under the Baofangzi No. U 20000152, and the large assembly plant substation, which is located in the land of Baoding State-owned (2000) No. 1306002671, to which the company belongs.

2. Description of ownership status

The subject property of the transaction does not involve litigation, arbitration matters or judicial measures such as seizure or freezing, and there are no other circumstances that hinder the transfer of ownership.

3. Details of the transaction subject

Unit: 10,000 yuan

(2) The price of the related party transaction

According to the Asset Appraisal Report issued by Beijing CE Hua Asset Appraisal Co., Ltd. on March 17, 2021 (CE Hua Appraisal Zi (2020) No. 1799, which has been filed for the asset appraisal of Bingyi Group), with November 20, 2020 as the appraisal base date, the carrying amount of the gross floor area of the property to be transferred is RMB5.5374 million, the appraisal value is RMB5.6841 million, and the appreciation amount is RMB146,700, representing an appreciation rate of 2.65%. The price of the related party transaction is 5.6841 million yuan (excluding tax).

For details of the introduction of the valuation method and the estimation process of the appraisal results, please refer to the "Baoding Tongwei Electrical Equipment Co., Ltd. Proposed Transfer of 5 Housing Building Project Asset Appraisal Report" disclosed on http://www.sse.com.cn the website of the Shanghai Stock Exchange on the same day.

4. Main contents and performance arrangements for related party transactions

(1) The main terms of the related party transaction contract

The two parties to the contract for this transaction are Baoding Electric Equipment Co., Ltd. (Party A) and Baoding Tianwei Baobian Electric Co., Ltd. (Party B), the transaction price is 5.6841 million yuan, the payment method and term are: Party B pays 50% of the transfer price to Party A in cash within 10 days after the signing of this agreement, and pays the remaining 50% after the completion of the transfer registration procedures for all real estate.

Within 10 days after Party B pays Party A the first price of Article 4, Party A and Party B sign the Asset Delivery Management List for the transaction assets, which is deemed to be the delivery of assets to Party B.

Party A is responsible for supervising and cooperating with Tianwei Group and Party B to jointly handle the corresponding transfer procedures in accordance with the provisions of the relevant management departments and complete the delivery of assets. The various taxes and fees that need to be paid in connection with property rights transactions and transfers shall be borne by Party A, Party B and the original property owners in accordance with the relevant provisions of the State.

Any violation of this Agreement by both parties shall be liable for breach of contract in accordance with the relevant provisions of the Contract Law.

In the event of a dispute between the parties over the interpretation and performance of this Agreement, it shall be resolved through friendly consultation. If no agreement is reached, either party may file a lawsuit with a people's court with jurisdiction.

This Agreement shall enter into force upon signature and official seal of the legal representatives of both parties or their authorized representatives.

(2) Arrangements for performance

In order to avoid the situation that the property purchased by Baobian Electric cannot be transferred in the future, it has been stipulated in the contract that Party B shall pay 50% of the transfer price to Party A in cash within 10 days after the signing of this agreement and pay the remaining 50% after completing the transfer registration procedures for all real estate, so as to protect the interests of the listed company.

The Board of Directors authorizes the management of the Company to handle the subsequent transfer of property on behalf of the Company and sign relevant agreements and documents in accordance with the relevant requirements of the Government.

5. The purpose of the related party transaction and the impact on the listed company

(1) The purpose of the related party transaction

1. Meet the needs of Baobian Electric production and operation and office activities

The real estate to be acquired this time are all real estate necessary for the company's production and operation and office, and are occupied by the company for many years, and the company's ownership of the ownership of the assets is realized after the acquisition is completed, which can ensure the company's normal production and operation and office activities.

2. Promote the transfer of land and real estate of Baobian Electric to achieve the integrity of the company's asset ownership

Baobian Electric through the asset replacement with Tianwei Group into the factory occupied land (Baoding City State-owned (2000) No. 1306002671) and some above-ground real estate, is currently going through the transfer procedures, according to the relevant policies, must achieve the integration of real estate, that is, the land and above-ground buildings are all owned by Baobian Electric, in order to apply for a real estate registration certificate, the company was expected to complete the relevant real estate rights transfer registration procedures before March 25, 2021, due to the performance of the relevant approval procedures accordingly extended.

(2) The impact of related party transactions on listed companies

This real estate acquisition will be conducive to the company's final realization of the complete unification of land and real estate ownership, and is conducive to the company's normal production and business activities.

6. Deliberation procedures for the performance of the related party transaction

On March 26, 2021, the 35th meeting of the 7th Board of Directors of the Company deliberated the "Proposal on the Acquisition of Part of the Property of Baoding Tongwei Electrical Equipment Co., Ltd.", which involved related party transactions, and after the recusal of the affiliated directors Wen Hong, Li Dacheng, Sun Wei and Liu Wei, the proposal was voted by 4 non-affiliated directors, and the proposal was passed by 4 votes in favor (including 3 votes in favor of independent directors), 0 votes against and 0 abstentions.

The independent directors of the Company issued a prior approval opinion on the proposal: in order to achieve the integrity of the ownership of assets, the Company intends to acquire a total of 5 units of baoding under the heading of Baofang Zi No. U20000151, steel plates, 250T gantry hanging oil pump room and the tank room under Item U 20000152 of Baofang Zi, and the substation of the large assembly plant. The transaction price is determined on the basis of the appraisal report issued by the appraisal institution, and the transaction price is fair and reasonable, and does not harm the interests of minority shareholders. Agreed to submit this proposal to the 35th meeting of the 7th Board of Directors of the Company for consideration.

The independent directors of the company expressed their independent directors' opinions on the proposal: the proposal involved related party transactions, the affiliated directors recused themselves from voting, the deliberation procedure complied with the relevant laws, regulations and the articles of association of the company; the transaction price was determined on the basis of the appraisal report issued by the appraisal agency, the transaction price was fair and reasonable, and the interests of the minority shareholders were not harmed, and the consent was given.

7. Documents for reference

(1) The resolution of the 35th meeting of the 7th Board of Directors of the Company;

(2) Prior approval opinions signed and confirmed by independent directors;

(3) Independent directors' opinions signed and confirmed by independent directors;

(4) Assessment report.

This is hereby announced.

Baoding Tianwei Baobian Electric Co., Ltd. Board of Directors

March 26, 2021

Stock code: 600550 Securities abbreviation: Baobian Electric Announcement number: Pro 2021-007

Baoding Tianwei Baobian Electric Co., Ltd

Announcement of the resolution of the 35th meeting of the 7th Board of Directors

1. The convening of the board of directors meeting

Baoding Tianwei Baobian Electric Co., Ltd. (hereinafter referred to as the "Company") issued a notice of convening the 35th meeting of the 7th Board of Directors of the Company by mail or delivery on March 11, 2021, and the 35th meeting of the 7th Board of Directors was held by means of a communication vote on March 26, 2021, and all 8 current directors of the Company participated in the meeting. The meeting is held in accordance with the provisions of relevant laws, administrative regulations, departmental rules, normative documents and the articles of association of the company.

2. Deliberations of the board of directors meeting

After careful deliberation and voting, the directors attending the meeting passed the "Proposal on the Acquisition of Part of the Real Estate of Baoding Tongwei Electrical Equipment Co., Ltd." (the proposal involved related party transactions, and after the affiliated directors Wen Hong, Li Dacheng, Sun Wei and Liu Wei recused themselves from voting, the proposal was approved by 4 votes, 0 votes against and 0 abstentions).

In order to achieve the integrity of the ownership of the assets, the Company decided to acquire 5 properties held by Baoding Tongwei Electrical Equipment Co., Ltd.

For details, please refer to the "Announcement of Baoding Tianwei Baobian Electric Co., Ltd. on the Related Party Transaction of The Acquisition of Real Estate" disclosed on the website of the Shanghai Stock Exchange on the same day http://www.sse.com.cn and Securities Daily.