Sundy Land Investment Co.Ltd(600077) ( Sundy Land Investment Co.Ltd(600077) ) announcement on reply to the regulatory concern letter of Zhejiang Securities Regulatory Bureau

Securities code: Sundy Land Investment Co.Ltd(600077) securities abbreviation: Sundy Land Investment Co.Ltd(600077) Announcement No.: pro 2022046

Sundy Land Investment Co.Ltd(600077)

Announcement on replying to the regulatory concern letter of Zhejiang Securities Regulatory Bureau

The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.

Interpretation of this announcement

The company, the company and Sundy Land Investment Co.Ltd(600077) refer to Sundy Land Investment Co.Ltd(600077)

Party A, Tibet Summit Resources Co.Ltd(600338) refers to Tibet Summit Resources Co.Ltd(600338)

The joint venture of Zhejiang Songdu lithium Technology Co., Ltd. and tus Qingyuan (Shanghai) new material technology Co., Ltd

Fit

Party B 1. Songdu lithium refers to Zhejiang Songdu lithium Technology Co., Ltd

Party B II. Tus Qingyuan refers to tus Qingyuan (Shanghai) new material technology Co., Ltd

Beihai lithium want refers to the partnership (limited partnership) invested by Beihai lithium want

Hainan Huazhi refers to Hainan Huazhi investment partnership (limited partnership)

The remaining minority shareholders refer to Beihai Lixiang and Hainan Huazhi

The controlling shareholder of the company refers to Zhejiang Songdu Holding Co., Ltd

The actual controller / Chairman / President of the company refers to Yu Jianwu

This project refers to the lithium extraction construction project of lithium carbonate salt lake with an annual output of 50000 tons

Sundy Land Investment Co.Ltd(600077) (hereinafter referred to as "the company" or "the company") received the regulatory concern letter from Zhejiang Securities Regulatory Bureau on March 23, 2022. After verification by the company, the reply to the letter is as follows:

"In our daily supervision, we noticed that on March 13, 2022, your company announced the

According to the cooperation agreement and announcement on providing financial assistance to foreign countries, Zhejiang Songdu lithium Technology Co., Ltd. (hereinafter referred to as Songdu lithium Technology), a holding subsidiary of your company, signed agreements with tus Qingyuan (Shanghai) new material technology Co., Ltd. Tibet Summit Resources Co.Ltd(600338) and other relevant parties, and Songdu lithium technology provided financial assistance to all the contract equipment funds of 1.6 billion yuan. The matter reached above was considered at the 35th meeting of the 10th board of directors of your company, and all three independent directors abstained.

According to the records of the 35th meeting of the 10th board of directors and other materials provided by your company, please explain the following matters.

1. Although the internal directors of the company voted in favor, they still have great doubts and objections to the matters under consideration. Please explain whether the relevant doubts and objections have been eliminated, and if so, specify the ways to eliminate them; In case of great doubts about this matter, whether it is appropriate to vote in favour.

reply:

(I) at present, the doubts and objections of internal directors have been basically eliminated.

According to the further investigation and materials collected by the management, the company provided the following information to the internal directors: 1) the feasibility study report on the lithium extraction construction project of Argentina lithium potassium Co., Ltd. with an annual output of 50000 tons of lithium carbonate salt lake issued by Changsha Nonferrous Metallurgy Design and Research Institute Co., Ltd. in December 2021; 2) Comprehensive budget adjustment report of Songdu group in 2022 (stress test: 65.88% of the value of goods removed under the background of strong sales); 3) The quotation scheme received from the supplier and the calculation of the actual investment arrangement of the project; 4) Tibet Summit Resources Co.Ltd(600338) 's financial capital, credit investigation report and Tibet Summit Resources Co.Ltd(600338) disclosure of capital operation in the early stage of the cooperation project; 5) Conditions and safeguard measures for the company's collection after external financial assistance; 6) Analysis of possible business risks faced by the company and the consortium and possible countermeasures, etc.

After referring to and reviewing the above materials, the internal directors of the company believe that: "at present, the doubts and objections in the discussion of our board of directors have been basically eliminated. However, in view of the fact that the parties to the transaction are still negotiating the business arrangement and the subsequent agreement is still negotiating, based on the consideration of the interlocking business arrangement, we will follow up and pay attention to the further negotiation arrangement of the company and urge the company to fulfill the obligation of information disclosure in strict accordance with laws and regulations.

According to the information provided by the current management, we have basically eliminated our doubts and objections. At present, the company has made a detailed and clear discussion on the decision-making and commercial rationality of the project, the relevant risks and solutions of the project, the source of funds and the risks of uncertainty in the promotion of the project, and disclosed the discussion process, For details, please refer to the announcement on replying to the inquiry letter of Shanghai Stock Exchange disclosed by the company on March 28, 2022. " (II) explanation on voting in favor of this matter in case of great doubt.

The internal directors of the company believe that the minutes of the meeting of the board of directors refer to the truthful recording of the speeches, opinions and suggestions of the company's directors at the meeting of the board of directors. In itself, it is the process of recording the discussion and discussion, not the result, and cannot be recognized as the result of the meeting. The results of the meeting shall be based on the resolutions of the meeting.

The internal directors of the company can reach a consensus and vote in favour for the following reasons:

In terms of business considerations, first of all, in the market environment where the real estate sector is affected by the tightening of regulation policies such as centralized land supply and financing policies and full of uncertain factors, the company needs to seek business innovation and breakthrough, so as to have the opportunity to cultivate new profit growth points of the company. Secondly, the signing of this cooperation agreement is an opportunity for the company to innovate its business, which is in line with the current industrial direction of carbon neutralization and carbon peak. The company participates in medium and long-term operation and output through appropriate advance payment in the early stage. During this period, the company forms a team with the consortium unit to accumulate technical level, which is in line with the overall business plan. In the process of innovative business development, the company will put risk control in the first place, actively explore and innovate in new fields, establish its own technical team, and strive to create a new situation for the development of the company

In terms of procedure arrangement, since this business cooperation is not the traditional business of the company, with the further deepening of business negotiation, it is an inevitable process in the process of business cooperation to consolidate and adjust materials and refine cooperation agreements.

The affirmative vote does not mean that the management of the company has no obligation to continue to perform the duty of due diligence, but puts forward the requirements and direction of due diligence to the operation management.

2. The board of directors of the company did not conduct sufficient due diligence on the above projects before the meeting, and the company did not fully prepare the personnel and funds of the project. Please explain the current due diligence plan, progress and fund arrangement plan of the project.

reply:

(I) current due diligence plan and progress

The company has hired Zhejiang Tiance law firm to conduct due diligence investigation on the brine lithium extraction technology and process of the project, the project company and its partners and partners within the scope of the information provided by our company and relevant parties. The scope of due diligence will include but not limited to: the establishment of the project company, its affiliates and partners Investigate the existence, change and current situation; Investigate the current situation, circulation and change of mining rights obtained by the project; Investigate the regional geology, structure and metallogenic conditions of the mining right; Investigate the deposit, ore body, grade, symbiotic beneficial components, resource retention, recoverable reserves and grade under the mining right; Investigate the technology and process of extracting lithium from brine held by the partner, as well as relevant patents, know-how and successful cooperation cases; On the basis of the above investigation, issue the legal due diligence report.

(II) fund arrangement plan

Recently, the company has received the quotation scheme for the membrane process section and adsorption section of the project, and the payment place is domestic. Assuming that 1.6 billion yuan is fully invested by the company, the specific calculation is as follows:

Calculation of membrane process section: according to the project quotation scheme of lithium chloride refining, concentration and crystallization section of Tibet Summit Resources Co.Ltd(600338) Argentina anheles Salt Lake 50000 tons of lithium carbonate equivalent lithium chloride project issued by tus Qingyuan on March 15, 2022, the total investment cost of membrane process section of the project is 800 million yuan. According to the payment node agreed in the project quotation scheme:

Calculation (assuming that the contract will come into effect on May 1, 2022) agreed items of the contract project

Payment time and amount

10% of the total contract amount shall be paid within one week after the advance payment contract comes into effect, and RMB 80 million shall be paid in the first ten days of May 2022

40% of the total contract amount shall be paid within 4 months after the equipment payment contract takes effect, and 320 million yuan shall be paid by the end of September 2022

After the 72 hour performance acceptance is qualified, Party A shall pay 360 million yuan at the earliest by the end of 2023 and pay it to the acceptance collection at the latest

95% of the total contract amount from the completion of the first phase repayment payment is 760 million by the end of March 2024

Others can accept up to 20% bank acceptance --

In the membrane process section, the advance amount of the company in 2022 is 400 million yuan, and the first repayment amount of the company is expected

480 million yuan (1.6 billion yuan 30%) and the corresponding interest, and continue to advance 400 million yuan. The company expects the cumulative net payment of funds to be less than 320 million yuan by the end of March 2024 at the latest.

Calculation of adsorption section: according to the quotation for adsorption section of Tibet Summit Resources Co.Ltd(600338) Argentina anheles Salt Lake 25000t / a lithium carbonate project issued by Xi'an Lanshen Material Technology Co., Ltd. (hereinafter referred to as "Xilan material") on March 14, 2022, due to the recent increase in the market price of lithium salt raw materials, the contract price was adjusted from 646 million yuan to 750 million yuan. The payment mode of advance: 1 year; The advance period is 1 year from the date of signing the contract. The interest is calculated annually

8%. Assuming that the effective date of the contract is May 1, 2022, the company expects to pay $7.5 before May 1, 2023

RMB100mn

To sum up, combined with the investment nodes shown in the quotation scheme of membrane process section and adsorption section, the company does not need to invest 1.6 billion yuan at one time in 2022, and there are conditions for rolling investment in subsequent years, which greatly relieves the capital expenditure pressure of the company at a single time point to a certain extent.

3. Your company holds 51% of the shares of Songdu lithium, and Songdu lithium provides 1.6 billion financial assistance to the outside world. Please

Specify the specific scheme of providing financial assistance.

reply:

Based on the company's capital feasibility analysis and investment arrangement calculation, the company has formulated three types of financial assistance schemes.

(I) capital feasibility analysis and investment arrangement calculation

Fund feasibility analysis:

According to the "comprehensive budget adjustment report of Songdu group in 2022" issued by the company's financial department, without considering new projects (stress test: under the background of realizing strong sales, the de converted value is 65.88%),

In 2022, the company's real estate projects can achieve a total sales contract of 20.209 billion yuan and sales collection of 25.683 billion yuan

Billion yuan, which is expected to pay 12.918 billion yuan in costs, expenses, taxes and other expenses in 2022, which can be realized in 2022

The current financing inflow is 4.867 billion yuan, and it is estimated that 15.514 billion yuan of financing needs to be returned. On the basis of ensuring the normal expenditure of the project, song Dufang returned a total of 1.233 billion yuan from each project. Therefore, it is estimated that the disposable capital in 2022 will be 1.233 billion yuan.

If the controlling shareholder completes the commitment on schedule, it is expected that the company can release the amount of restricted certificate of deposit guarantee in 2022

900 million yuan. In this case, it is estimated that the company's disposable capital will be 2.2 billion yuan in 2022, which is predicted to be settled

The results show that the company's disposable funds in 2022 can cover the company's one-time advance of 1.6 billion yuan in 2022

End condition. If the shareholders fail to fulfill their commitments on time, the remaining gap will depend on the company's financing and the rest of the lithium branch subsidiary

With the joint support of shareholders.

Calculation of capital contribution arrangement: see the above 2 (II) capital arrangement plan for details

(II) financial assistance scheme

Scheme 1: Songdu lithium Co., Ltd. self raised funds

If all the 1.6 billion yuan comes from the self raised funds of Songdu lithium, the shareholders of both parties will raise the capital of Songdu lithium according to the shareholding ratio

Guarantee with capital. If the company provides full guarantee, the remaining minority shareholders will hold Songdu according to the investment agreement

The equity proportion of lithium branch provides counter guarantee to the company.

Scheme 2: the shareholders of Songdu lithium science and Technology Co., Ltd. contribute according to the shareholding ratio

In terms of financial support for the amount of 1.6 billion, the remaining shareholders of Songdu lithium promise to hold Songdu lithium in accordance with their shareholding

Therefore, the company contributed 816 million yuan and the other shareholders contributed 784 million yuan.

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